I think it's safe to say that most of us have felt the pain from gasoline prices for a long time. For me, yesterday hurt worse than usual.

Rather than emailing me some horror story, one of my readers decided to send me a small article cut out from a newspaper. Naturally, the title referred to the outrageous price of gas. I simply shrugged and was about to toss it aside until I saw the price.

This article was complaining about gas being $1.80 a gallon!

It took me a moment to make sure I read it correctly. Then I realized it was dated over three years ago. I was tempted to call up the author and ask their thoughts about gas prices averaging $3.51 a gallon.

For the rest of the day, I tried to remember what it was like paying under two bucks a gallon. When I had to pull in to my local station this morning, I sighed after glancing at the reading $3.40/gallon. It turns out I was running on fumes, so my fill-up was probably my most expensive trip to the pump to date.

As I made my way into work, however, my mood brightened. Every station I passed on my way into the city was more expensive than the last. By the time I reached my parking spot, gas prices reached as high as $3.55. I know it's not too much higher, but I felt a little better.

Don't get me wrong, I feel lucky my gas is that cheap. I know some of my readers outside the U.S. are paying over $6 a gallon. Even inside the U.S., one of my readers in California commented on how she had to fill up her car for $4.30 this week.

Am I expecting to shell out over $4 for a gallon of gas by July?

Absolutely.

Gas Saving Tips

I usually reserve my personal gas saving tips for July, when the summer driving season is in full swing. Unfortunately, we don't have that much time. In order to keep your car fuel efficient, I've scrounged up ten tips you can use to squeeze every penny you can out of each gallon of gas.

• Restrain yourself from topping off at the pump.

• Check and replace your air filters.

• Keep your tires inflated.

• Car maintenance.

• Use cruise control.

• Don't drive aggressively (this includes speeding up and slowing down frequently on highways.)

• Drive at lower speeds to increase fuel efficiency.

• Don't let your car sit idle for long periods of time.

• Buying high octane gas is an unnecessary expense, unless your car requires it.

• Make sure to regularly check your oil.

Another Gas Hike?

A few months ago, I mentioned that oil prices were most likely heading to $120 a barrel. Now that winter is gone, I don't see any relief in sight. Remember, if oil experiences an increase similar to last year, prices could hit $140 a barrel by July.

So what's driving up the price of oil?

Well, it all depends on who you ask.

This week, the International Energy Agency (IEA) tried to help answer that question for us. Although the IEA admits there is "no single explanation for higher prices," they did argue that fundamental factors are to blame. In other words, global demand is growing and putting more oil on the market is getting harder.

At first, this sounds like the IEA is coming to terms with peak oil. They were quick to point out that the problems with supply growth are centered more on "above-ground" risks rather than field depletion and decline rates.

I don't think you need me to tell you what kind of effect that $140/barrel oil will have on our pump prices. And if this past winter was an indication of where crude oil is headed, perhaps $5 or even $6 per gallon isn't out of the question.

Until next time,

Keith Kohl

Energy and Capital

P.S. Let's face it, most of us have complained about gas prices at one point or another, no matter where we live. But soaring energy prices are providing investors with the opportunity of a lifetime. Most of my readers are already taking advantage of record oil and gas prices. I'd suggest checking it out for yourself at the $20 Trillion Report.

"Energy stocks... The only way a human is going to make any money."

-- Matt Simmons, Peak Oil's first and most vocal proponent,
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"oil experts have said on CNBC"... CNBC?!?!? you believe that crap???

Hi Keith; with all due respect, oil prices are rising because of the speculators. Oil experts have said on cnbc, that oil should be at the $60, a barrel. I admit that oil prices are rising due to the increase in demand, but not this fast. I understand that oil was not traded in the futures market until 1983, of oil futures were removed from the markets, oil prices would rise but not as rapid as they are now. What the President Bush should do, is put his energy on the US Dollar, and stop lowering rates. Thank You

Reminds me of gas wars at service stations in sc.Our local Hess station was 16cent per gal for reg gas.this was 1970 if I remember correct!

I know how you all feel the empathy of havig to pay for a fill up at the gas station. Here in Australia we pay the equalivent to your gallon at $7.75 AUD and we are almost on par on the exchange rate. We must be the highest payers in the world???

I had to smile at your recollection of once paying less than $2 per gallon for gasoline. One of the few advantages of being 70 years old is a real perspective on the decline of the dollar.

Recently, I had filled my tank with 12 gallons of gas for $40. It occurred to me that I could remember when you could buy 40 gallons of gas for $12 (30¢ per gal).

It was 1965, and I was driving a band new 1965 Pontiac GTO Tri-Power with 360 HP. It had been custom ordered for a buyer who backed out, and the dealer was eager to sell it for $3000 cash.

At the time, that was 1/3 of my annual income as an MS engineer. When my kids feel sorry for my salary history, I remind them that the "equivalent" car today would be 50 percent of the annual pay of a freshly minted MS engineer. I was also able to support a stay at home full-time mom & two young boys while I still had that car. It's all a lesson in currency debasement.
CHG

Every time I hear about Americans paying $3.50 per gallon I just laugh. I filled up in Niagara Falls NY this weekend for $3.64 per gallon. A bargain! On the Canadian side, gas was selling for $1.20 per litre, or about US$4.55 per US gallon. I saved over $12 by filling up in the USA. We've been paying the equivelant of $4/gallon for months now and while nobody's happy, the sky has yet to fall. People adapt, carpool, walk, and lose the giant SUVs at trade in time. We'll live through it (and we'll live through $5, $6 and $7 per gallon too)

You did all your readers a service by advising them how to conserve gas.

Where are our political leaders on this issue. Why does the White House not implement a massive conservation effort? Slowing the federal highway system to 60 MPH would save 500,000 barrels a day.

Keep up the good work. Please publish a weekly reminder on how to save fuel.

Many regards, K. Kelley

It is my opinion without a doubt the demand of fuel is one of the main causes for the rise of gasoline all over the world except in the Oil Producing Countries. Iran, Kuwait, Argentina citizens are paying less than a dollar a gallon. We in American and in Europe and the most of the NATO nations are getting the shaft.
I also agree with keeping your vehicle in top running condition, and properly tuned will save gasoline.
Unfortunately we do not live in a perfect world where all vehicle operators will reduce their speeds, learn to drive more practical, stop the rediculous speeding from one light to the next so they can be first. Learn to be more conservative, fill your tanks when it is necessary for long trips, and avoid using cars for close by shopping. The fuel crisis is not going to go away, but consumers can learn to slow down and drive more responsible. They also can learn to use more public transportation to conserve gasoline. Making long vacation trips should be placed on the back burner until we can some control on the price of fuel. I don't have a clue what the savings would be if some of these measures are acomplished, but I would bet it would be substantial. Be a good driver and make a strong effort to comply with some of these restrictions. Do nothing and watch the prices continue to grow up, and up. Also watch everything else rise due to the fuel increases.
Butchrgt