Oil Ends Week Near $113 a Barrel

gas pricesOil surged above $112 per barrel Friday following a drop in the dollar and continued jitters about shipments from the world's major oil suppliers.

Benchmark West Texas Intermediate for May delivery jumped $2.49, or 2.3 percent, to settle at $112.79 per barrel on the New York Mercantile Exchange. Crude oil set new 30-month highs almost every day this week.

Oil moved higher as the dollar plunged against other major currencies. Oil is traded in dollars and tends to rise when the greenback falls and makes crude cheaper for investors holding foreign currency. The looming shutdown of the federal government threatened to weaken the dollar further and encouraged more buying, according to analysts.

Oil also climbed on fears that violence in Nigeria ahead of the country's national election this weekend could lead to supply interruptions. And in Venezuela a massive blackout appears to have affected some refineries, analysts said. The two countries supply a combined 2 million barrels of oil per day to the U.S.

If crude prices keep rising, experts say, gasoline prices could hit $4 a gallon across the U.S. this summer.

Pump prices have jumped from $3.07 to $3.74 per gallon since the beginning of the year. The swift rise forced the Oil Price Information Service to boost its retail gasoline price forecast to a range of $3.75 to $4 per gallon this year. OPIS chief oil analyst Tom Kloza said it may not be long before the national average tests the all-time record of $4.11 per gallon set in July 2008.

Further price hikes could do serious damage to the U.S. economy, he said. For consumers, "gas prices have more relevance on an emotional level than a lot of other things that they pay for," Kloza said. "People pay more attention to gasoline than phone service, cable TV or other services," Kloza said.

The national average for a gallon of gas is now 88.3 cents higher than the same time last year, according to OPIS, AAA, and Wright Express. It's already above $4 per gallon in California, Alaska and Hawaii, and it's almost there in Connecticut, Washington, D.C., Illinois and New York.

Oil and gasoline prices began a steady rise in February, as the Libyan rebellion shut down the country's daily exports of 1.5 million barrels of oil. Libya produces about 2 percent of world demand, and analysts say making up for those losses will severely reduce the ability of other oil-producing countries to increase production in the future. Saudi Arabia and other OPEC countries are covering some of the shortfall in Libyan crude, which went mainly to refineries in Europe.

Barclays Capital has said that Libya's oil exports probably will be offline for several months. As fighting continues more traders are going along with that prediction.

"The market is being forced to consider a possible major loss of Libyan barrels probably through the rest of this year and into next," analyst Jim Ritterbusch said Friday.

Experts point to other factors that have pushed oil and gasoline to record levels. The U.S. economy added hundreds of thousands of jobs this year. That means gasoline demand could increase this year as more workers join the daily commute. And last month's devastating earthquake and tsunami in Japan put further pressure on oil prices. Japan is expected to boost oil and natural gas imports while some of its nuclear power plants are offline.

In other Nymex trading for May contracts, heating oil added 11.37 cents to settle at $3.3197 per gallon and gasoline futures gained 7.42 cents to settle at $3.2607 per gallon. Natural gas lost 1.6 cents to settle at $4.041 per 1,000 cubic feet.

In London, Brent crude rose $3.86 to settle at $126.12 on the ICE Futures exchange.

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Well, we have eclipsed the $4 mark in NY,now the runnup to $5 begins.The lack of response from our elected officials from BOTH sides is despicable. This is a planned runnup based on things that might happen not on things that have actually interrupted supply. The only thing in short supply is $$ in our pockets.Can't wait for the stock market collapse as the economy tanks.

April 11 2011 at 7:27 AM Report abuse +1 rate up rate down Reply

When Bush met with Opec when gas was $4 a gallon he got no where. Early 2009 Obama met with Opec along with our allies thru the UN and they agreed to hold oil at $75-$80 a barrel until the world economies stabalized. And they did for almost two years. I watched it every night on the Nightly Business Report. It has only been recently that increases have been made due to demand coming back from economic recoveries around the world and the unrest overseas. We are still producing more oil in the US than we ever have.

April 10 2011 at 10:55 AM Report abuse rate up rate down Reply
1 reply to inasctg56's comment

High speed rail would reduce our dependency on oil. More goods could be transported because it doesn't take as long and it costs less, fewer trucks on the highways, less road repair, more people would travel because it does't take as long which also contributes to our economy thru hotels, restaurants, and tourist attractions. Look up how many other countries around the world have this but us. The gop fights it and thinks they are the only one's right and the rest of the world is wrong.

April 10 2011 at 10:52 AM Report abuse rate up rate down Reply

Bush had no energy policy, preferring to 'let the market determine the price for oil' and the kinds of cars auto makers want to manufacture. Bush also opposed Democrats efforts to make domestic vehicles more fuel-efficient. As a result, when emerging market oil demand and investor speculation pushed oil over $80 per barrel in 2007 and then over $100 in 2008, high energy costs squeezed disposable income further, almost guaranteeing a recession. The recession appeared, starting in late 2007. Further, sales of less-efficient U.S. manufactured cars and SUVs slumped badly. And by the end of 2008, Detroit's auto makers need a massive government loan to avoid bankruptcy.

To be sure, the oil patch states of Texas and Oklahoma boomed, but every other region of the country suffered economically during the Bush years. Further, when the housing bubble burst and hundreds of billions of mortgage-backed securities went bad, the financial crisis began, spread around the world, and the U.S. recession deepened, with corporate revenue and earnings declining and job lay-offs mounting. More than 2.6 million jobs were lost in 2008 alone, and the unemployment rate, which stood at 4.2% when President Clinton left office in January 2001, has increased to 7.2% in January 2009, as President Bush leaves office.

And the republicans still refuse to attend energy meetings.

Democrats have passed legislation that took money away from big oil and directed it to our auto industry with mandates and now we have suv's that get 32 mpg, a waitinglist for chevy volts, new manufacturing facilties producing electric batteries and charging stations that are hiring and pay $12-$18/hr, and almost all autoworkers are back to work.

April 10 2011 at 10:48 AM Report abuse rate up rate down Reply

Haven't seen these prices since September of 2008 when Bush was in office. The US is the third producer of oil in the world, and Meet the Press stated last weekend that our oil production is at all time highs. Every time the dems mention regulating speculative buying the gop screams too much govt. Guess they don't won't to interfere with wall street and big oil making record profits.

April 10 2011 at 10:46 AM Report abuse rate up rate down Reply

Try spending 25,000 per week for a small trucking operation. We need to buy new and more fuel effiecient trucks but guess what we have to give it to the oil companies instead. Is that what obama meant when he said he stands behind small business. What a JOKE!!!!

April 10 2011 at 10:44 AM Report abuse rate up rate down Reply
1 reply to maloontransllc's comment

You get 100% write offs for improvements made in this country for machinery and equipment. So why not?

April 10 2011 at 10:47 AM Report abuse +1 rate up rate down Reply

It's tough depending on oil so much. Hopefully there'll be stability soon in northern Africa. In the meantime I watch Brent oil daily on Futurespros live chart:


April 10 2011 at 4:21 AM Report abuse +1 rate up rate down Reply

.The off shore drilling moratorium has applied to DRILLING RIGS ONLY ,, which at any given time there are LESS THAN 100 rigs actively drilling and does not hurt the job market because there are OVER 3 THOUSAND RIGS in the gulf right now producing NOT DRILLING and they are doing just fine,,, also there are hundreds and hundreds of CAPPED WELLS just sitting there in the gulf that were drilled years ago

.The off shore drilling moratorium has applied to DRILLING RIGS ONLY ,, which at any given time there are LESS THAN 100 rigs actively drilling and does not hurt the job market because there are OVER 3 THOUSAND RIGS in the gulf right now producing NOT DRILLING and they are doing just fine,,, NO MORE DRILLING BY ANY RIG UNTILL THAT RIG HAS BEEN INSPECTED FOR SAFETY____TURN OFF FIX NEWS

April 09 2011 at 4:35 PM Report abuse +1 rate up rate down Reply

.Thirty years ago a solemn Jimmy Carter sat behind the historic Resolute desk in the Oval Office to announce to a prime-time national television audience his new comprehensive energy plan. In the most memorable line of the evening, the president declared the challenge of energy "the moral equivalent of war."
The Carter energy strategy was both praised for its ambition (the written version had 113 parts) and derided for its interventionism -- critics(THE REPUBLICANS) tried to brand it with the acronym MEOW. Contrary to common mythology, Carter was far from a lonely voice calling for strenuous action. After the Arab oil embargo of 1973-74, both of his predecessors, Richard Nixon and Gerald Ford, called energy the nation's top priority and set an ambitious goal for "energy independence" (eliminating reliance on foreign oil by 1980, no less).

April 09 2011 at 12:13 PM Report abuse +6 rate up rate down Reply
1 reply to danielisticall's comment

When gas topped $4/gal. under Bush there were Congressional hearings and the media was having a tizzy fit. Now the media reaction is that these prices will make alternative energy more attractive. Wind and solar combined produce less than %1 of America's electricity, requires government subsidies and costs more for the consumer. We will never know exactly how much to expect since the wind does not always blow and the sun does not always shine. We will be using coal, oil and nat. gas for a long time to come and need to develop our domestic supplies.

April 09 2011 at 10:43 AM Report abuse +1 rate up rate down Reply