Auto industry guru Art Spinella of CNW Research says that gasoline prices could be hitting $5 a gallon by this summer. Right now, at this time of year, gas prices are higher than they normally are – the highest that they’ve been during this season, CNW said. According to the CNW Research study, consumers are seriously considering two things – number one putting off their purchase of new vehicles and number two buying hybrids and highly fuel-efficient vehicles with hybrids getting much attention.
According to the CNW Research study, $4.50 per gallon is the breaking point for consumers. Four years ago consumers had the experience of seeing gas prices shoot up dramatically and reach somewhere around $4.50 nationally; it was higher in some markets like California, close to $4.75 per gallon. Then prices dove down; they went back to being higher than they were initially but much lower than $4.50 per gallon. Since then, we’ve been seeing these prices creep up.
The long-term forecasts for gasoline and diesel prices and barrels of oil do vary by their sources. If “peak oil” does occur – where there’s only so much oil and it’s getting extremely expensive to drill down for enough of it – then these trends would make sense. But even if analysts don’t take peak oil seriously, they do agree that oil consumption is rising in markets like China and India, and more people buy their first cars ever. Commercial vehicles in these and other countries also play into the numbers.
Gasoline and diesel prices are probably the most important piece of the puzzle for global transition to electric vehicles, hybrids, and alternative fuel vehicles. What’s happening now does show it’s very difficult to predict fuel price trends, and things can change quickly.