Economic gains, Iranian threats lead to higher gas prices

Gas prices are shown at Chevron at 3450 SW Williston Road, Wednesday, Sept. 28, 2011 in Gainesville, Fla.

Erica Brough/Staff photographer
Published: Monday, January 9, 2012 at 2:04 p.m.
Last Modified: Monday, January 9, 2012 at 2:04 p.m.

Gas prices around Florida rose by 13 cents a gallon over the past week, according to an ongoing price survey by AAA. Gas was selling for an average of $3.44 a gallon in Florida over the weekend, AAA officials said.


Average unleaded gas prices in Florida

Current $3.441
Week ago $3.313
Month ago $3.308
Year ago $3.117
Source: AAA

Some analysts said the future direction of gas prices will be shaped by recent improvements in U.S. employment, an Iranian threat to block a key shipping canal and demand for fuel.

Factors pushing prices higher include Iran's threat to block ships from entering the Strait of Hormuz. The strait is a major shipping point for oil exports from the Middle East.

The potential for higher demand for gasoline is also on the horizon. Federal officials said 200,000 more people are working now than were a few months ago, a situation that could increase demand and lead to higher prices.

On the other side of the gas price equation are factors that could push prices back down. For example, analysts are weighing the potential for Europe to enter a recession. That could tamp down the demand for oil.

And despite more Americans now working, the federal oil supply is growing. The U.S. Department of Energy announced last week that the federal reserve supply grew by 2.5 million barrels to 220.2 million during the end of December.

In published reports, the publisher of the Lundberg Survey -- Trilby Lundberg -- attributed the price increase in part to increases in crude oil prices. Lundberg told CNN that recent increases in wholesale gas prices have not yet been completely passed on to drivers, but if crude oil prices remain at their current levels, drivers might see increases in prices at the pumps as retailers catch up with the higher prices they are paying wholesale.

In her weekly news release on gas prices, AAA spokeswoman Jessica Brady said, “Gas prices generally inch up after the first of the year on optimism the economy will continue to improve and set the stage for increased demand in the new year.”

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