Higher Gas Prices Ahead?

Uncertainty over Washington’s response to the so called “fiscal cliff” is driving up oil prices and will likely cost consumers more at the gas pump.As Congress and the president prolong their stalemate over a debt reduction plan aimed at avoiding hefty budget cuts and automatic tax increases financial markets are already responding. Particularly noticeable is movement in the price of west Texas crude. Gregg Laskoski is a Senior Petroleum Analyst with Gasbuddy.com. He says that market isn’t waiting for politicians’ last minute deal, “We know that there’s a great deal of financial nervousness in the markets and that’s pushing up the price of crude oil and we’ve seen it go up $2.50 a barrel just in the last 24 hours and it’s over $91 a barrel right now. That’s not good news for American consumers.”

And Laskoski says that will make its way to the pump eventually.

Currently the state average is $3.19 per gallon. That’s the lowest price in about a year.

Petroleum industry analysts are hopeful that some type of plan to avert the fiscal cliff can still be reached this year so prices don’t spike. Laskoski says if it’s a good plan the markets will respond, “I don’t think it would take long for the financial markets to react either positively or negatively to whatever the resolution is that congress is able to cobble together.”

Still, Laskoski says to expect gas prices to start going up in early spring, as they always do when refineries across the country slow production and switch from the federally mandated winter blend of gasoline to the summer blend.