Editorial
Drivers at the mercy of oil markets
Photo credit: AP | A gasoline station in Del Mar, Calif., reflects rising gas prices (Feb. 21, 2012)
The price of gasoline is up and expected to go even higher, a painful prospect for consumers and the nation's fragile economic recovery. So the issue is sure to be sucked into the vortex of the presidential campaign.
But political spin aside, soaring gasoline prices are not something Washington can do much about. They're subject to global market forces that have made periodic fluctuations a fact of life.
The cost of a gallon of regular gas averaged $3.92 yesterday on Long Island and $3.57 nationally. Industry analysts warn that prices are likely to go higher, maybe even topping last spring's $4.28 a gallon. And rising gas prices ripple through the economy, because they increase the cost of transporting goods, such as food and clothing.
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Instability in the Middle East is the major culprit. Oil prices surged in recent days after Iran halted shipments to Britain and France, in retaliation for economic sanctions imposed on Iran because of its nuclear weapons program. Iran has also threatened to block oil shipments through the Strait of Hormuz, the route for about 20 percent of the world's oil.
That disruption and uncertainty have created a buying frenzy globally and driven speculation in the futures market. And that's happening just as some refineries in the United States temporarily shut down and retool to produce summer blends of gasoline. Others are idle and up for sale.
Cooling Middle East tensions would help. So would an OPEC decision to pump more oil. But these fluctuations, unfortunately, are out of our control.
