Watch CBS News

The Rise Of Gas Prices And Its Effects

COON RAPIDS (WCCO) -- How about paying $4 a gallon for gas? Some experts say it will happen soon, and we won't be paying more just at the gas station.

We're already seeing an uptick here in the Twin Cities.

"I guess until I'm willing to drive less I can't complain too much," said Eric Setter of Coon Rapids.

What you put in your tank is directly affected by what is occurring half a world away. Right now, Iran is upset over tighter sanctions. So, the country has threatened to close a major waterway where a huge percentage of the world's oil reserves pass through every day.

"When the value of Mid-East gas goes up, that increases the value of all kinds of gas throughout the planet," said professor David Vang.

Vang, a finance professor at the University of St. Thomas, says we've knocked on the door of $4 gas in recent years and by Memorial Day, we will knock it down.

Your groceries and your airfare could also increase. Vang says they are all tied together.

As the price of oil goes up, so does jet fuel and Vang says some airlines could tack on an extra $10 to their airfare to off-set the costs.

"If one or two airlines can make this stick, then others will follow," said Vang.

Fuel prices also come into play when food is delivered to grocery stores. So milk, eggs, cereal and everything in-between could see a slight hike.

But consumers have been down this road before. One man we talked with told us he is from England, but currently lives in Georgia and drives 1,200 miles to visit his daughter in Minnesota. For him, every little cent adds up.

"Let's hope it doesn't go up to $4 a gallon," he said.

Vang said another reason gas prices go up as we get closer to spring is because the refineries switch to a different kind of gas that uses more ethanol.

Vang added that if we do hit $4 gas, it will likely go back down by the fall -- as will the price of food and airfare.

View CBS News In
CBS News App Open
Chrome Safari Continue
Be the first to know
Get browser notifications for breaking news, live events, and exclusive reporting.