http://www2.nysun.com/article/75363

"Get ready for another economic shock of major proportions — a virtual doubling of prices at the gas pump to as much as $10 a gallon.

That's the message from a couple of analytical energy industry trackers, both of whom, based on the surging oil prices, see considerably more pain at the pump than most drivers realize.

Gasoline nationally is in an accelerated upswing, having jumped to $3.58 a gallon from $3.50 in just the past week. In some parts of the country, including New York City and the West Coast, gas is already sporting a price tag above $4 a gallon. There was a pray-in at a Chevron station in San Francisco on Friday led by a minister asking God for cheaper gas, and an Arco gas station in San Mateo, Calif., has already raised its price to a sky-high $4.62.

In Manhattan, at a Mobil gas station at York Avenue and East 61st Street, premium gas is now $4.03 a gallon. Two days ago, it was $3.96. Why such a high price? "Blame the people at STOPEC (he meant OPEC) and the oil companies," an attendant there told me.

These increases are taking place before the all-important summer driving season, signaling even higher prices ahead.

That's also the outlook of the Automobile Association of America. "As long as the price of crude oil stays above $100 a barrel, drivers will be forced to pay more and more at the gas pump," a AAA spokesman, Troy Green, said.

Oil recently hit an all-time high of nearly $120 a barrel, more than double its early 2007 price of about $50 a barrel. It closed Friday at $118.52.

The forecasts calling for a jump to between $7 and $10 a gallon are based on the view that the price of crude is on its way to $200 in two to three years.

Translating this price into dollars and cents at the gas pump, one of our forecasters, the chairman of Houston-based Dune Energy, Alan Gaines, sees gas rising to $7-$8 a gallon. The other, a commodities tracker at Weiss Research in Jupiter, Fla., Sean Brodrick, projects a range of $8 to $10 a gallon.

While $7-$10 a gallon would be ground-breaking in America, these prices would not be trendsetting internationally. For example, European drivers are already shelling out $9 a gallon (which includes a $2-a-gallon tax).

Canadians are also being hit with rising gas prices. They are paying the American-dollar equivalent of $4.92 a gallon, and they're being told to brace themselves for prices above $5.65 a gallon this summer.

Early last year, with a barrel of oil trading in the low $50s and gasoline nationally selling in a range of $2.30 to $2.50 a gallon, Mr. Gaines — in an impressive display of crystal ball gazing — accurately predicted oil was $100-bound and that gasoline would follow suit by reaching $4 a gallon.

His latest prediction of $200 oil is open to question, since it would undoubtedly create considerable global economic distress. Further, just about every energy expert I talk to cautions me to expect a sizable pullback in oil prices, maybe to between $50 and $70 a barrel, especially if there's a global economic slowdown.

While Mr. Gaines thinks there could be a temporary decline in the oil price, he's convinced an overall uptrend is unstoppable. In fact, he thinks his $200 forecast could be conservative, and that perhaps $250 could be reached. His reasoning: a combination of shrinking supply and increasing demand, especially from China, India, and America.

Mr. Brodrick's $200 oil forecast is largely predicated on a combination of pretty flat supply and rip-roaring demand. Other key catalysts include surging demand in China and India, where auto sales are booming, and major supply disruptions in Nigeria and also in Mexico, our second-largest source of oil imports, where oil production has fallen off a cliff.

More factors include the ever-present danger of additional supply disruptions from volatile countries in the Middle East that are not our allies, and the unwillingness of SUV-loving Americans to trim their unquenchable thirst for foreign oil. Likewise, for the first time, emerging markets this year will use more oil than America.

To Mr. Brodrick, it all adds up to an ongoing energy bull market. His favorite plays are the Energy Select Sector SPDR Fund ; United States Natural Gas Fund LP; Apache Corp.; Occidental Petroleum; Anadarko Petroleum, and Schlumberger."

 

I was about to post that earlier. IMO if gas hit betwen $6-$8 a gallon something bad will happen.
The question I have is if Canada has more oil reserves than any country but Saudia Arabia why come is not cheap like it is in the MiddleEast?

 

$10 would be murder for alot of people. I personally would find it outrageous to be paying over $200 a tank since Ive been filling my tank up ever 3-4 days.

 

Because the large part of that Canadian reserve is in the form of tar sands. Not the drill a hole in the ground and svck it out variety of middle east. It requires more money/time/equipment/capital spending/etc to bring that tar sands oil to the market.

 

Then our economy would go flat...
and we will run out of cheap oil and resort to lower grade petroleum sources until those run out.....
Then we are all screwed

 

Ok, time to kill the polar bears and caribou. Alaska, here we come.

 

Hmmm an oil exec and and a commodity trader/analyst pumping oil/gas prices. What a surprise. Certainly anything's possible. Dumbass Bush could bomb Iran tomorrow and crude might pop to $200. Or not. Any thing short of that sort of thing, crude and gasoline will stay up or go up some thru summer driving season but it's not gonna hit $200 anytime soon. And if dollar's stops tanking, crude can easily go back down to $50-60.

 

The WORLD economy would collapse if it does.

Lots of people will fail to go to work, make less money, default on credit cards and loans, destroy their credit, destroy the housing market, destroy businesses, and put entire governments into bankruptcy.

May sound dramatic, but it's quite a possibility...

 

You're right. There would be a serious depression. If it reaches $5/gallon, there will be a major recession. This is no joke, people. If the working class can't get gas to get to work, afford to go out, go to restaurants, go see movies, the economy will collapse.

Maybe then the government will step in and do something about this crap. Maybe not.

 

The world is not going to end. We will just use less gas and find some alternative to cope with the price hike.

 

time to start walking to work

 

ugh all i wish is for anything to be cheaper alt gas or reg gas!

 

Not in the U.S, where transportation is key to our survival.

And not just for commuters in metropolitan areas.

Farmers and truckers will have to quadruple the costs of shipped items. Those big trucks do not sip gas; they guzzle it between trips from the Midwest to California, New York, and Florida.

Are you willing to pay for $3 tomatoes? $5 corn? $20 for a 5 lb sack of potatoes? Can you imagine going to McDonald's and ordering a $10 salad?

 

i was talking to my boss and he analyzed it saying he expects oil to go up to 200 bucks a barrel before it levels off.

personally i think it's going to be hard to hit 10 bucks a gallon, but i think 7 bucks a gallon is possible, maybe as soon as mid of next year.

life will still go on even with that price. things will just be very slow and economy will be bad. but i am not sure if it will go from recession to depression yet

 

Time to bring my bicycle out from storage. I hope my boss will understand if I'm late because of my 4 hr commute.