For all practical purposes, we've reached $4-a-gallon gasoline. The government's latest survey, out this afternoon, shows that in L.A. the average price of regular is $3.767, more than eight cents higher than just a week ago and another record high. Relief is not in sight: oil prices neared $112 a barrel Monday. The problem continues to be that investors regard oil and other commodities to be a hedge against inflation. Also, a weaker dollar makes oil cheaper to investors overseas. All that pushes up prices. Not that it's easy to forecast how this stuff will play out, but you do hear analysts talking about gas prices peaking in early summer. "Take your vacation late this year," Jim Ritterbusch, president of an energy consulting firm, tells AP.
Still, unexpected refinery outages have forced pump price spikes in the past. Last spring, a string of unanticipated refinery outages caused gas prices to peak at record levels in May. Prices then mostly fell until late in the year, when they began to track crude oil higher. Prices normally rise in the spring as suppliers stock up in advance of peak summer driving season, and as refiners switch over from making winter grade gasoline to the more expensive, but less polluting, summer version of the fuel. As they perform this switch, refiners try to sell off all of their winter grade fuel, driving overall supplies down.