Gasoline Headed for $3 by Christmas

Gasoline Prices on the Rise

For the first time ever, analysts believe that we could see a Christmas with gasoline prices higher than $3.00 per gallon on average in the U.S. Typically gasoline prices are down during the holidays in an effort to encourage holiday spending in the retail sector. However, this year, with crude oil prices over $90 a barrel for the first time in two years, record gas prices look like a virtual certainty.

While the $3.00 plus national average is not yet a reality, for some parts of the country, it look like Christmas has come early. The Energy Department reported that in California, where gas prices typically lead the trend, the average pump price was $3.28 this week.

In the report, the DOE stated that the typical pattern of higher prices in the higher demand months of the summer and lower in the winter has changes this year. “Prices typically rise during the summer driving season and drop after Labor Day. However, 2010 has seen a reversal in this pattern. The national average price has risen by 30 cents a gallon since Labor Day, the largest increase over that period.”