Weather patterns and international events have caused the nation's gas prices to rise for the first time since June 2002.
The Lundberg Survey, an independent market research company specializing in the U.S. petroleum-marketing industry, released a nationwide survey Sunday concluding that gas prices raised an average of 11 cents per gallon nationwide.
American Petroleum Institute analysts attributed this jump in prices to several major factors, including the nation's preparation for war with Iraq and the current economic situation.
Economics Prof. Jason Taylor however, said he believes the price hike is not due to America's economic situation, but rather is a product of the world's oil suppliers who are anticipating a war with Iraq. He explained suppliers are limiting supplies now in order to sell them during the crisis for a higher value.
"The market tends to move in advance of a crisis," Taylor said.
The uncertainty of war is not the only reason for the current price increase. Continuing oil strikes in Venezuela and cold weather also are major contributors.
According to the institute, Venezuela was the nation's third largest supplier of oil in October 2002. A current month-long oil strike has decreased Venezuelan crude oil supplies, which has added to the rising price of crude oil.
Prices jumped from $28 a barrel in Jan. to over $35 a barrel this month. Ultimately the increase in crude oil has lead to an increase in gas prices at United States pumps, in-home heating oil and natural gas.
The institute's analysis and statistics conclude the nation's inventory of distillates, which includes heating oil and diesel fuel, is down 18 percent from this time last year.
Unusually cold weather patterns across the nation also have lead to increased demand for oil.
Taylor said he does not expect an immediate effect on the economy, though problems could arise in the future. Increases "won't have a big macroeconomics impact," he said. "If prices stay up for periods of up to 6 months a year then that could quite possibly have an impact on the nation's economy."
Despite Taylor's analysis, local gas station owners say they are starting to feel the effect of price increases already.
Gas prices have gone up an average of 12 cents in the Charlottesville area. Some owners say their business is already starting to slow down.
"I wonder if it is going to be like back in 73," said Roger Morris, manager of a Wilco Gas station in the Charlottesville area. He said he fears that this situation could eventually have the same effect as the OPEC oil embargo that occurred in 1973.
Taylor, however, was hesitant to compare the current price jump to past events.
"This generally occurs during military incidents," Taylor said. "Whether a real crisis occurs or not, prices tend to go up anyway in anticipation."
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