You'll Pay $700 More For Gasoline This Year (If You're Average)

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According to the Department of Energy, the average U.S. household will pay $700 more for gasoline this year than it did in 2010.

In a weekly review of the oil market, the department's Energy Information Administration noted that prices will rise at least 10 cents more over the current national average of $3.50 a gallon, due to the lag in wholesale price rises reaching the pump.

It also projected that peak gas prices, which historically occur over the summer, will reach $3.71 a gallon. That's a full dollar higher than the average price at the same time last year.

And the DoE says the chance that gas prices will soar above $4 a gallon this year is higher (25 percent) than the likelihood they'll fall below $3 (10 percent).

2011 Toyota Prius

2011 Toyota Prius

Enlarge Photo

The current price rise is driven by uncertainty over the impact of political unrest in several oil-producing countries, most notably Libya.

Consumer interest in fuel-efficient cars, smaller models, and hybrids and clean diesels has risen, and more 40-mpg-rated cars are available in the U.S. market now than ever before.

(With a combined EPA rating of 50 mpg, the 2011 Toyota Prius hybrid remains the most fuel-efficient car sold in the U.S. today that doesn't plug in.)

But some analysts suggest that buyers not pay too much attention to gasoline prices.

The argument goes like this: You can't predict what will happen to oil prices, and buyers run the risk of overreacting and getting a smaller or a different kind of car than the one you really want.

But what do you think? Will the present rise in the cost of gas lead you to buy a different car than the one you might otherwise have gotten?

Tell us what you think in the Comments below.



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Comments (6)
  1. In fact if the gasoline price rise of 2008 is any guide, it might be a good time to buy that SUV. When gasoline prices hit $4/gallon, people were dumping SUVs like they were on fire. The prices crashed and it was a great time to buy one. Perhaps a year later, gasoline prices had crashed back to $1.60/gallon and you could afford to drive your SUV (only on weekends please.
    On the other hand, fuel efficient cars can be a great economic hedge against rising gasoline prices.

  2. Peaking at $3.71/gal?!?!?!?! Who are you kidding? Prices in central NY are already at $3.80/gal and it isn't spring yet...

  3. I know this has been said many times before but the price rise is fast than the price lowers. And that is related to wholesale prices.
    Can you say cartel?

  4. I think it's the right time to buy a camel or horse.

  5. Well, in my house, we will probably be impacted more. We heat with gasoline, er. diesel, er. home heating oil. Whatever it is, it goes up with the price of oil.

  6. We have been cutting back on our miles driven. Conservation is a hell of a lot cheaper than buying a new hybrid or EV.

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