Gas prices push closer to $3.50 a gallon, oil hits $117

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The price of crude oil went up because a militant group in Nigeria sabotaged a major pipeline and the group promised further attacks on the country's oil industry.

According to a spokeswoman for Shell the pipeline was leaking and it does appear the damage was caused by explosives. The U.S. considers Nigeria a major supplier of oil and this recent event will surely boost gasoline prices.

The national average for gas rose to 2.7 cents overnight and Diesel fuel added 2.2 cents, according to a survey of stations by AAA and the Oil Price Information.

The soaring prices are adding more grief to people's lives and they are already feeling the effects of a slowing economy, falling home values and the job market. Food prices are also rising because of the soaring prices in Diesel fuel, that is because most of the world's trucks, trains, ships and heavy equipment use diesel.

Sources say that gas prices will likely rise to $3.80 a gallon and at some point in time the national average could reach $4 a gallon.

Oil prices started booming back in 2006 because attacks were happening on Nigerian oil infrastructure and that caused the country to cut nearly one-quarter of the petroleum output.

Some sources believe that the price of oil has gone up this year because of the weak dollar. A stronger dollar makes commodities less attractive to investors as a hedge against inflation.


Sources say that interest rates could be cut several more times this year and that will weaken the dollar even more and that will cause the price of oil to hit new records.

The excuses keep rolling in because more sources say that refiners are switching from winter grad gasoline to the more expensive, less polluting, version of the fuel they're required to sell during summer. Sources say that when the oil companies do that each spring they usually tend to keep supplies down to low levels as they try to sell off all of their winter fuel.

The last paragraph of this article says that supplies are kept down to low levels on purpose. If there is such a huge shortage of oil than why would they keep levels so low? They did not even mention when they start to do this process. There will always be a new excuse to the rising price of oil.