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Gas Prices Expected To Hit $5 By Memorial Day

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Gasoline pump. (Credit: CBS)

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CHICAGO (CBS/WBBM) – We’ve been hearing about it for weeks, and now, experts say $5 per gallon gas is almost certain by Memorial Day.

As WBBM Newsradio 780’s Mary Frances Bragiel reports, the unrest in the Middle East continues to leave its mark on the price of oil. Light sweet crude was trading Thursday at nearly $107 per barrel, an increase of $2.45 for the day.

LISTEN: Newsradio 780’s Mary Frances Bragiel reports

AAA reports the average price for a gallon of gasoline in the Chicago market has hit $3.82 a gallon, compared to $3.02 a gallon a one year ago.

With that analysts believe crude oil prices could rise another $2 on Friday, pushing gasoline prices even higher.

The sharply rising prices hearken back memories of the summer of 2008.

That year, oil prices were driven well above $100 per barrel, and in June of that year and gas prices were well over $4 a gallon. At the time, the U.S. Department of Energy said they expected prices to stay there for a year to come.

The crushing financial crisis later that year drove oil and gas prices down. But now, the sticker shock is back.

The reasons for the spike in oil and gas prices are different than in 2008. Back then, the cause wasn’t quite as obvious – it was blamed variously on high demand for oil in countries such as India and China, speculators on the futures market, and even “peak oil,” the theory that oil production had gone into a terminal decline and scarcity would keep prices going up forever.

But this time around, the rising prices are the clear result of unrest in the Middle East and North Africa — the crisis in Libya in particular — and the resulting jitters in the global oil market.

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