With oil passing the $100/barrel mark on Thursday, analysts are warning that a gallon of gasoline could soon cost as much as $5 this summer.
“If this thing escalates and there’s a good chance that there’d be a shift in supplies, $5 gas isn’t out of the question,” said Darin Newsom, an analyst at energy firm DTN told USA Today.
With major oil companies pulling out of Libya, the 15th largest crude oil exporter in the world, oil futures contracts are trading at levels not seen since October of 2008. While countries like Saudi Arabia could theoretically pick up the slack, the disruptions will still cause a spike in prices. Other factors like increased demand as the weather warms up, and the constantly increasing demand from China, could see average gas prices continue to rise.
[Source: USA Today]