LUBBOCK, TX (KCBD) - Just from Monday to Tuesday gas prices across Texas rose almost a nickel. And just six months ago, a gallon of gas was a full $1 cheaper than it is today. We found gas prices from $2.45, $2.48 and up to $2.53 around the Hub City on Tuesday. But what is fueling the price increase?
"This year we had a price increase jump before the holiday," says Bolton's owner Charles Bolton. "And we kind of expected it to go back down but since then it has actually gone up several times."
Drivers across the city have mixed feelings on the current price increase. "I'm actually kind of happy as long as we don't reach $4," says Chris Lujan. But others are crossing their fingers they don't see a repeat of last summer.
"I hope not, because I could barely afford that," says Heather Whitlow.
Bolton says in the last few weeks prices have increased 25 cents. But why were gas prices so low? And why now are they starting to inch back up?
Texas Tech Finance Professor Scott Hein says the reason we've seen gasoline prices at the pump back up is because that crude oil price has started to increase has come back.
Hein says last summer the price of a barrel of oil reached $150. Since then, prices dove to $35 and are currently at $68 a barrel.
Scott Hein as we hit the fall, the U.S. Economy ran into a brick wall. We've seen the unemployment rate pick up, and what we've seen in the United States has happened in Europe and other parts of the world even China has slown down because of that.
Demand for energy products have fallen off. Hein says the reason for the recent spike is the result of the economy starting to stabilize. But he predicts gas prices will not reach the $4 mark that we almost hit last summer.
Hein says, "I don't think we'll see the demand that we saw last year and because of it I don't think gas prices will sky rocket like they did a year ago." He also says gas prices reflect a combination of federal, state and local taxes, and that Texas, is a state that is better off because we don't have as high a gas tax as many other states.
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