We often see price increases in January. What's particularly troubling for consumers is that the average price for the first month of 2006 is starting at a much higher level than it did a year ago.
This is not a lot to reassure the consumer. The only upside to high prices is that it should ensure a steady supply because there is an economic incentive to produce and ship it.
Crude oil is more expensive than it was after Hurricane Katrina. And we haven't had a natural disaster that is causing these high prices.
People who buy hybrids also want to support the innovative technology to spur a technological answer to the challenge of high fuel prices and dependence on foreign oil.
This is just the beginning. People tend to drive more as the weather warms up, and the resulting increase in consumption triggers higher fuel costs.
Consumers are numb to these high prices. Some of this is what the market will bear. Part of the problem with higher prices is we set a new benchmark in our mind and $3 is the new record.
We are entering the time of year when historically gas prices have tended to rise because consumption increases. We are starting out this season at a level that is much higher than last year, and last year was certainly no bargain at the gas pump.
Prices are high -- the question is why? We have enough crude oil and gasoline to meet current demand, and yet the cost of fuel continues to cause budget concerns for many consumers.
Drivers are now paying an average price that is 27 cents higher than a year ago. And last year was no picnic.