Text size:

Another record high for gasoline prices

BY TOM INCANTALUPO | tom.incantalupo@newsday.com

April 22, 2008

Gas prices hit another record yesterday, leaving Long Islanders to wonder: Will it ever stop?

There's plenty of blame to go around for the latest surge in prices, which this year have gone from high to record-breaking to downright scary.

That's due in part to investors who are driving prices up by investing in commodities like oil. Those investments are seen as safer than stocks and bonds because of the weak U.S. dollar, the value of which has declined 9 percent this year.

There's also the growing thirst for oil by China, India and other large developing countries, which is creating demand that threatens to outstrip supply.

The surge in oil prices in turn is affecting the costs of virtually everything shipped by truck, of heating homes, of getting to work or even taking the boat for a spin or making plans for a vacation this summer.

In New York futures trading yesterday, crude oil rose to more than $117; on New Year's Day the $100 mark hadn't been breached.

The price of heating oil, similar to diesel fuel soared this winter because of rising world demand for diesel.

Short term, the U.S. government has a few options to bring prices down, experts said, but most are politically tricky. Presidential candidate Sen. John McCain, for example, wants the 18.4-cent-per-gallon federal gasoline tax suspended for the summer to give motorists some quick relief. He also wants a temporary halt in the addition of oil to the nation's strategic petroleum reserve, to help reduce global demand for oil. But, U.S. Energy Secretary Sam Bodman has rejected both ideas.

Consultant Andy Lipow said another option is to increase the federal gasoline tax to discourage driving.