NEW YORK , June 8, 2008
New Reality: $4 A Gallon At The Pump
Gas Prices Hit Miserable Milestone Just In Time For The Driving Season
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Play CBS Video Video Gas Prices Hit All-Time High For the first time in history, gas surpassed $4 a gallon. Gas prices are higher than they have ever been and the effect is rippling through the economy. Priya David reports.
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Video Economic Effects Of Oil Prices Oil prices made their largest one-day leap ever, and consumers need to prepare for long term high prices. Russ Mitchell speaks to former U.S. Secretary Of Labor, Robert Reich.
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Video Britain Copes With Gas Prices Americans are not the only ones facing soaring gas prices. British motorists are also seeing high costs at the pump, which has produced dramatic effects. Elizabeth Palmer reports from London.
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The average price of gasoline passed the $4 a gallon milestone (AP / CBS)
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Interactive Gas Prices State-by-state averages, tips to improve mileage and a look at what fuels prices at the pump.
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Interactive CBS Gas Price Patrol Follow CBS News' Cross-Country Gas Price Patrol with our interactive map, photo essays, road logs and video archive.
Prices at the pump are expected to keep climbing, especially after last week's furious surge in oil prices, which neared $140 a barrel in a record-shattering rally Friday.
While Americans who have to drive will feel the biggest squeeze, the increased prices also translate into higher costs for consumers and businesses, who will be forced to shoulder increased transportation costs of food and anything else that needs to be transported.
Gas prices rolled past their latest threshold Sunday, increasing to $4.005 overnight from $3.988 a gallon the day before, according to AAA and the Oil Price Information Service.
Of course, drivers in many parts of the country have already been paying well above that price for some time.
California has seen some of the highest prices; a gallon there now averages $4.436 a gallon, the most in the country. Missourians are paying the least at the pump, with a gallon in the Show-Me State selling for a relatively cheap $3.802 a gallon.
Truckers and others with diesel engines under the hood have it even worse off. A gallon of diesel now sells for $4.762, up nearly a penny overnight. Prices hit a record atop $4.79 at the end of May.
Skyrocketing oil prices are largely to blame for the surge. Soaring demand in Asia and elsewhere ensures global supplies remain tight even as Americans cut back; recent figures from the U.S. Energy Department's Energy Information Administration showed U.S. gasoline demand actually fell 1.4 percent over the last four weeks.
CBS News correspondent Priya David reports the rocketing cost of gas will effect every aspect of American life, reaching far beyond the fuel tank fill-up.
The cost of Kimberly-Clark diapers, maker of the popular Huggies brand, will go up by eight percent; Goodyear has raised the price of it's synthetic tires by 15 percent; Dow chemicals, maker of oil-based paints and plastic mobile phones, has increased its prices 20 percent across the board, reports David. All these items are manufactured using petroleum-based products.
Jordan Goodman, of MoneyAnswers.com, tells David the whole "lifestyle in America is based on cheap gas."
"We've built these suburbs all over the place on the assumption that we're going to have one dollar a gallon gas, not four or five dollar a gallon gas. So the whole infrastructure of the country is built, in a way, on something that doesn't exist anymore," says Goodman.
Crude prices shot up more than 13 percent late last week in their biggest two-day price gain in history. Benchmark light, sweet crude for July delivery officially finished the week at $138.54 on the New York Mercantile Exchange, but at one point jumped as high as $139.12.
The eye-popping prices are leading many motorists to rein in their gas consumption, either by cutting back on all but the most essential driving or looking anew at alternatives like public transportation. Sales of gas-guzzling vans and sport-utility vehicles are down, while those of fuel-efficient compacts and hybrids are on the rise.
Some drivers are getting creative.
Take Robert Torrey of Connecticut, the state tied with Alaska as the second most expensive state for gas. After leaving work in the town of Windsor Locks last week, he drove across the border into Massachusetts to fill up his van with $100 worth of gas. He figures he's saving about $10 per fill-up by traveling the 18 miles north.
"I let it run all the way down to the bottom before I get here," said Torrey, while pumping gas at the Pride station off I-91 in Springfield, Mass. "I try to combine it with other trips while I'm up here, so that makes it worth the drive."
© MMVIII, CBS Interactive Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.
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Best-selling author Mitch Albom on his first nonfiction work since "Tuesdays with Morrie."
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See all 555 CommentsFor much of George W. Bush''''''''s first six months, energy policy has been an oily albatross around his neck. The President''''''''s plans to step up drilling on federal lands, expand nuclear power, soften environmental safeguards, and increase refinery capacity were panned by the public and marked the abrupt end of his honeymoon. With Bush being bashed as a shill for Big Oil, you''''''''d think his energy plan would be dead and buried...
Posted by bhoogren at 12:46 PM : Jun 09, 2008
How fast everyone forgets. His energy proposals were kickeed down by congress. Almost eight years passed since George Bush proposed more drilling, new refineries, and new nuclear energy power plants.
Posted by bhoogren at 12:46 PM : Jun 09, 2008
How fast everyone forgets. His energy proposals were kickeed down by congress. Almost eight years passed since George Bush proposed more drilling, new refineries, and new nuclear energy power plants. abuse
If the CTFC got of it''''s (_)_) and did its job, speculators would not be able to bid the price to $5.00 oil, which is where we may be in one month if this keeps going.
Posted by dredre2k
dredrek2k, the Asian times did an entire series of articles on this and you are correct. While our own press covers Brittney Spears most of the posters on this board are content to follow the lies of supply and demand or that China is sucking it all up.
Posted by talkingham
LOL isnt THAT the irony, their racism is costing them money now man! It''s all about the chilrun, the chilrun man!
Completely agree. I will be quite happy when oil reaches $10. Conservation will win!
Posted by zoe2006
Did you not READ the article? did you not see where companies are increasing their product prices across the board? did you not see one company increased it''s prices 20% and tires by Goodyear going up 15%?
You get a 20% raise this year?
How about your groceries? you didn''t happen to notice those went up TOO and will continue to do so, what will you DO when that $2 hamburger meat tray is $14 and that gallon of milk is $12.50? still gonna leap for joy over gas prices THEN?
He figures wrong, when you add in the per mile prorated costs for insurance, maintenance and wear/tear and then even add his time to drive that much further and back, he isn''t saving as much as he THINKS.
Last Fall the price dropped to $44 a barrel and there is no way that the demand has increased more than 3 fold since that time. If we don''t nationalize the ownership o these resources they are going to drive us and what''s left of our economy into a complete depression.
The laws are designed to coddle and reward the speculators for ripping us off. Of course I only have to drive 3 miles to work, but all the whities who moved out to suburbs so their kids wouldn''t have to go to school with black kids are paying the price.
Posted by zoe2006
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Maybe you can go stand in for her?
Posted by zoe2006 at 01:07 PM : Jun 09, 2008
+ report abuse
If 4$ gallon is leading to conservation let it go up to 8 gallons. Conservation is the way to go, not increasing supply.
Posted by dchu76
You two are really bright...NOT!! Fuel costs drive most consumer prices so be careful what you wish for. Enjoy the bumpy roads because it''s too expensive to pave and better plan on a garden and raise your own beef and poultry. Just to let you in on a little secret; oil doesn''t really cost that much to produce and deliver it''s all a ruse so the rich get richer and the poor....well you get the idea! Go be selfish and narrow minded somewhere else and stop encouraging these rip-offs!
It''ll be $6 a gallon before the summer is out and $12 a gallon by the time President McCain leaves office!
Why"
The Iraq war is bleeding us $12 billion a month!
To pay for that, the neocons have been printing money.
More US dollars in the world means a weak US dollar.
Under Bush the dollar has declined 40%.
For every dollar you earned, the neocons have stolen 40 cents.
By the time President McCain leaves office, it would be worth only 30 cents what it was in 2000.
The neocons have ravaged the country, and it looks like four more years of the same.
As President Reagan said, "You ain''t seen nothin'' yet!"
Posted by dchu76
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So 8 gallons for $4? That''s $2 a gallon so sounds good to me.
Bush and Cheney just returned from Saudi Arabia and failed to increase oil production
You needed to say that Bush and Cheney have failed this country in so many countless ways and are complete Douschbags. January 20th is Cocktail Day and good ridance to all the Douschbag Bushies.
Posted by zoe2006
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Since oil is around $138 now that will be quite the decrease.
If the CTFC got of it''s (_)_) and did its job, speculators would not be able to bid the price to $5.00 oil, which is where we may be in one month if this keeps going.
Oh, and GOPSoccermom is my *** goddess...
Yes they are a lot higher than what we are used to paying, and yes it is raising the prices of everything else to rediculous hights. I am sure that gas will be above $5 in the U.S. before Labor Day and home heating oil will top that this winter.
Anyone who didn''t know that this day was comming is a blind fool.
Yes they are a lot higher than what we are used to paying, and yes it is raising the prices of everything else to rediculous hights. I am sure that gas will be above $5 in the U.S. before Labor Day and home heating oil will top that this winter.
Anyone who didn''t know that this day was comming is a blind fool.
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