Surge in gasoline price boosting cost of goods and services

Soaring gasoline prices are expected to remain painfully high, affecting nearly every aspect of the economy, from
how much consumers pay for many goods to, in some cases, how much they earn.
Oil prices rose Monday to a 29-month high in New York as escalating violence in Libya bolstered concern that supply
disruptions may spread.(Nikon EN-EL15 battery) The price of a barrel of oil in the U.S. was more than $105, up 29 percent from a year ago.
Gas prices are following closely and are going to "continue to rise in the near term," said Beth Mosher, spokeswoman for AAA Chicago.(CANON Battery) But AAA isn't yet considering $5 gas, Mosher said.
Michael Lynch, president of energy consulting firm Strategic Energy & Economic Research, said he thinks current pump
prices are close to a peak, "unless we see more serious trouble in Saudi Arabia or Iran."

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"I do think we'll be around $3.50 (nationally), and it probably won't come down until the Libyan situation is
settled," Lynch said. "I still think we'll see lower prices by summer.''
In the Chicago region, the average price for regular gasoline was $3.72 a gallon Monday, up 86 cents from a year ago. (Nikon en-el15 Battery)That translates to an extra $516 in annual gasoline costs if driving 15,000 miles in a vehicle that gets 25
mpg, or more than $1,000 more for a two-car family.
Some Chicago-area gas stations are charging more than $4 a gallon for regular.
Yiannis Melidis, co-owner of Pegasus Restaurant & Taverna, at 130 S. Halsted St. in Chicago, said fuel surcharges on
such services as seafood delivery and garbage pickup have boosted the cost of running his business by 3 to 4
percent. Pegasus is absorbing those costs, but to keep profit margins from shrinking it has been cutting employees'
hours.(CASIO camera battery ) A waiter who had worked 32 to 36 hours a week, for example, now works 28 to 30 hours a week.
Over the weekend, Southwest Airlines climbed aboard a sweeping increase of $10 in the price of many domestic round-
trip airfares, citing fuel prices. JetBlue Airways said Monday that it recently implemented a $45 one-way surcharge
in select Caribbean markets. Last week, Delta Air Lines tried to raise many fares up to $20 per round trip, but
other big airlines sided with a $10 increase started by American Airlines.(Charger)
Fees are also going up for passengers checking more than two pieces of luggage, and more carriers are ditching free
snacks to save money, said Tom Parsons, chief executive of travel site Bestfares.com.
"The airlines are jacking up rates wherever they think they can get away with it," Parsons said.
Travelers may have to pay $260 for a ticket that cost $200 on Jan. 1. Jet fuel prices have risen more than 50
percent in the past year, to more than $3 a gallon.(FUJIFILM camera battery)
Grocery shoppers likely will start seeing the impact of gas prices during the summer, said Ron Paul, president of
Technomic, a food industry market-research firm.
"We expect a 2.5 to 3.5 percent (annual) increase," Paul said, which is a big jump from the 0.3 percent increase in
2010.
Chicago cabdriver Melissa Callahan leases her vehicle for $93 a day, and on Sunday, when she worked around the
clock, she paid $75 for gas. She remembers paying about $50 a year ago.(Canon Camcorder Battery)
"It's getting to the point where it's not worth it anymore," Callahan said.
In January, because gas prices topped $3.20 a gallon for seven business days, city law required that passengers pay
a $1 surcharge. It had been 50 cents since October 2009. That surcharge has remained at its $1 maximum since prices
began rising again recently.
Those who watch short-term gas prices at the U.S. Energy Department are forecasting higher prices, but not that much higher. (KODAK camera battery)An official report won't be released until Tuesday, but economist Neil Gamson at the Energy Information Administration said Monday that the forecast will put the chance of a nationwide average of $4 a gallon gas during
the summer at one in four, up from last month's probability of one in 10.
Patty Carroll would be glad to see a retreat in gas prices.
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