Costly gas prices forcing Utah drivers to shift gears
About 400,000 Utahns will travel over July Fourth. It is the second holiday this year during which traveling will have dropped. On Memorial Day, travel decreased 0.1 percent, according to surveys commissioned by AAA.
"It's not a huge decrease," said Rolayne Fairclough, spokeswoman for AAA Utah. "There's still plenty of people on the road. It shows that there is a trend. There is a decreased number of travelers."
AAA attributes the decrease to the price of fuel. The rising prices of gasoline and jet fuel have cut into people's discretionary budgets. On Tuesday, a gallon of regular unleaded cost a record-high average of $4.091 in Utah. The national average was just slightly cheaper, but also a record high: $4.087 per gallon.
Oil futures in New York and London reached new records Tuesday on worries about tight supply and mounting tensions in the Middle East. Light, sweet crude for August delivery closed at $140.97 a barrel on the New York Mercantile Exchange. In London, Brent crude futures rose 84 cents to settle at $140.67 on the ICE Futures exchange.
IEA chief Nobuo Tanaka added that OPEC is pumping oil at record levels and other producers "are working at full throttle." His comments reinforced the IEA's latest prediction that global supplies will remain pinched, despite record prices and falling demand in the U.S. and Europe.
"Day-to-day market noise can be driven by speculators," Tanaka said. "High oil prices are driven by fundamentals."
Meanwhile, during a visit to Berlin, U.S. Treasury Secretary Henry Paulson said "there don't seem to be any obvious short-term solutions" to soaring oil prices.
Oil prices began to rise in recent months as the value of the U.S. dollar fell relative to other currencies. Oil is traded in dollars, but for oil producers to get the same value by selling a barrel, they had to increase the price, Fairclough said.
Geopolitics also plays a part in oil pricing, and on Tuesday, ABC News quoted an unnamed Pentagon official as saying there is an "increasing likelihood" that Israel will strike Iran's nuclear facilities by the end of the year. Iran is the world's fourth-largest oil producer. While a State Department spokesman could not verify that report, the psychological unrest was reflected in the markets.
Recent comments
Well, remember Murder cycles or Donor cycles can cost you a lot more...
Ken Baguley | July 2, 2008 at 8:05 p.m.
Apparently, some of you are so touchy fom paying 100 bucks to fill...
"Mo" | July 2, 2008 at 6:22 p.m.
James, a cold air intake and exhaust are not giving you 25 more miles...
James J | July 2, 2008 at 3:48 p.m.
