Monday, August 07, 2006

Oil to go even higher

"Oil prices could increase by as much as $10 per barrel given the current
environment,'' Emori said. "But we can't really say for sure how big an effect
this is going to have until we have more exact figures about how much production
is going to be reduced.''

If you thought that the current prices in the Twin Cities metro were high -- even by Minnesota standards -- at $2.99-$3.09/gallon for regular unleaded gas (but $2.55-$2.69/gallon for E85 ethanol blend), just wait until the pipeline issue in Alaska hits the prices. With crude oil already at $74.57/barrel after an increase of $1.53/barrel over the weekend, another $10/barrel increase would bring about prices at the pump between $3.20 and $3.35/gallon initially.

The extreme tightness in oil supplies just goes to show that we need alternatives. How much longer will people still drive their Chevy Suburban four blocks to the local Holiday gas station to pick up a gallon of Market Pantry milk?

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