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Is $5 Gas Unavoidable?

Nation facing economic slam - and political turmoil.

by on May.02, 2011

A rarity a month ago, $4 gas is now the national norm, some expecting $5 prices in a matter of months.

Late last year, when former Shell President John Hofmeister warned that the U.S. could see $5-a-gallon gas prices by 2012, few took the executive seriously.

“The wolf is out there,” acknowledged Tom Kloza, chief analyst with the Oil Price Information Service, and “we’ll see those numbers at some point this decade, but not yet.

Anyone who has had to fill up lately is starting to take Hofmeister’s dire forecast very seriously.  In Michigan, prices rose almost 20 cents in the last week, a pace seen across much of the country.  The Los Angeles area is already approaching the $5 mark, at least on premium fuel, and virtually the entire country is now over the $4 mark for unleaded regular at self-serve pumps.

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The surge in fuel costs is triggering a political free-for-all, President Barack Obama blasting the oil companies and demanding an end to oil company subsidies, while wild-card Republican Donald Trump has suggested the U.S. simply grab Mideast oil sources.

Ken Reidy, a contract trucker who maintains his own 18-wheel rig, said he didn’t care about the politics, “as long as someone helps me cut my fuel bill.”  Fueling up at a truck stop along Michigan’s I-94, Reidy’s eyes narrowed as he watched the numbers race seemingly every upward, ultimately handing over his credit card to cover an $895 charge for diesel.