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Gas prices rising precipitously
Dec 13, 2010 10:43 am

With crude oil prices at the highest level in more than two years, Tom Kloza, chief oil analyst at Wall, N.J.-based Oil Price Information Service, is saying in a Daily Finance report that prices are likely to drop a bit for the winter... and the reach much higher prices likely by springtime. Crude oil hit $90 a barrel last week, its highest point since 2008, when prices were plunging from that summer's high of $145 a barrel in the worst energy crisis of the last decade. Driving the higher prices is increased demand in China and developing nations around the world, forcing demand to rise above output in what may be a first demonstration of the concept of Peak Oil. More specifically, a many analysts are pointing to a more immediate cause being problems at a refinery in Nova Scotia that hit the U.S. East Coast in recent weeks. Kloza believes gasoline prices will hover around $3 a gallon until Christmas, and then drop back until spring. But then he expects them to surge dramatically, perhaps as high as $3.50 a gallon, although he that he doesn't think it will be long-lasting.