Iraqi Halt on Oil Trade May Affect Gas Prices

Gasoline prices have gone up nearly 25 cents per gallon nationally in the last month -- the highest increase ever in the United States for a single month.

The average price of gas in North Carolina is $1.42 per gallon, up from the $1.18 average a month ago.

In response to soaring gas prices, the U.S. Department of Energy has reactivated a hot line that allows consumers to register complaints about price gouging.

Corry Schiermeyer, Energy Department spokeswoman, said the agency has received hundreds of calls since the line was reopened Monday morning.

In an April 7 press release, Energy Department Secretary Spencer Abraham said several factors, including rising tensions in the Middle East, are contributing to the gas price increase.

Abraham said prices also are spiking because of the onset of the summer driving season, during which time more people travel long distances by car.

John Stewart, a UNC economics professor, also said that gas prices are seasonal and that increases should be anticipated regardless of the economic situation.

"(Prices) run cyclically," Stewart said. "Prices usually go up in the summer, and they'll probably start to come down in the fall."

Stewart said he could foresee prices increasing by as much as 10 percent to 15 percent in the next few months, adding that the decreased oil supply from the Middle East could result in a further increase of gas prices.

"Gas prices respond to world oil prices," he said.

But projected gas prices still fall below rates charged during the last two summers, despite the recent increases.

David Walker, owner of Walker's BP Service in Chapel Hill, said he has not noticed any change in consumer tendencies since the prices started climbing.

"I can't see where (business has) been effected," he said.

Walker said prices could go up in the next month while Iraq withholds oil. But he said there are too many factors involved in gas price setting to predict whether prices will increase.

"If I knew, I'd be in another business," he said. "The smallest things can change (the gas price), so it's impossible to forecast."

The State & National Editor can be reached at stntdesk@unc.edu.