Gas prices continue to rise

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DENVER -- After a brief pause, gasoline prices are continuing their march upwards, increasing another nickel this past weekend to $3.40 for a gallon of regular.

The national average now stands at $3.80 per gallon, due in part to an 8 percent increase in the price of crude oil since the beginning of the year.

"It's a little ridiculous but that's why I got a diesel car," said Laura Poole as she filled up her car on Monday in Denver.

"I still personally think that gas could be a lot less," said Jim Anest. "I mean we live in a great oil area and we just don't do enough to produce it."

One oil expert said that although the switchover by refineries to a summer blend of gasoline is responsible for some of the increase, speculation may be the most important reason.

"Clearly the answer is speculation in the commodities market," said Mark Larson, Executive Director of the Colorado Wyoming Petroleum Marketers and Convenience Store Association. Larson said investors trading in oil futures cause the price of crude to swing wildly.

He said the commodities market now acts like a nervous stock market, without regard to supply, which is ample right now, and demand, which is down.

"Thirty percent of the prices right now at the pump are driven by speculation so the average consumer doesn't understand that," Larson said.

He argued that the Commodity Futures Trading Association needs to more vigorously control oil futures trading. He said Congress has not adequately funded that group to date.

Meanwhile, the Obama administration, which has been under fire from Republicans for its handling of the issue, continues to defend its efforts to bring down energy costs.

"You know all options are on the table because the President obviously feels the pain that the American people are facing with respect to gas prices," said Energy Secretary Ken Salazar on Monday. 65% of Americans now disapprove of the way the President is handling the gasoline situation.

Colorado continues to have some of the lowest gas prices in the country but Larson said that's small consolation.

"We can't get lulled into the fact that we're the lowest price in the country," he said. "It's still higher than it should be."

 -- Hendrik Sybrandy

 

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