Price of gas rising

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The price of gas is going up, and it might stay that way through the holidays.

On Wednesday in Augusta, $50 bought Freddy Santiago, of Summerville, S.C., three-quarters of a tank of gas for his rental Hummer H3. The average price for a gallon of unleaded gas in the Augusta-Aiken area was $2.97, according to AAA.  Rainier Ehrhardt/Staff
Rainier Ehrhardt/Staff
On Wednesday in Augusta, $50 bought Freddy Santiago, of Summerville, S.C., three-quarters of a tank of gas for his rental Hummer H3. The average price for a gallon of unleaded gas in the Augusta-Aiken area was $2.97, according to AAA.

The travel season has yet to begin, but the average price of a gallon of unleaded gasoline in Georgia has already risen about 30 cents to $3, according to AAA.

Stations in Augusta reflected the increase Wednesday, with many posting prices of $2.99 for a gallon of regular unleaded.

Ric Cobb, the executive director of the Georgia Petroleum Council, said demand typically increases during the holiday season, and prices usually follow.

"I think between now and Christmas it's certainly likely that prices will hold or increase some," Mr. Cobb said.

Oil futures set a record Wednesday, trading above $98, but eventually settled above $95 by late afternoon on the New York Mercantile Exchange.

Mr. Cobb said Georgia drivers might feel the pinch earlier than other Southeastern states because the state levies a 3 percent motor fuel tax on top of its regular taxes.

"Whenever prices are moving up, Georgia's prices seem to be moving up, perhaps much more dramatically than our surrounding states," he said.

Still, prices aren't expected to deter families from taking to the roads this holiday, said Judy Reville, a spokeswoman for AAA of Augusta. She said drivers typically make allowances in other areas to recoup the extra money spent on fuel.

"With the gas prices, we really don't expect it to make a difference in travel," she said. "It's coming up on the holidays, so people are going to be gathering with family and friends."

Reach Adam Folk at (706) 823-3339 or adam.folk@augustachronicle.com.

OIL HAS BIG IMPACT


Oil prices raced toward $100 a barrel Wednesday, hitting $98.62 on the New York Mercantile Exchange before falling back to $96.37 at the close of trading. Many financial analysts expect prices to break $100 a barrel before year's end. Here are answers to some questions about oil's price rise:


Q: Will these high prices hurt the U.S. economy?


A: They haven't so far. The Census Bureau's recent survey of consumer expenditures showed that Americans spent about 4.3 percent of their wages on gasoline in 2005, up from 3 percent in 2002, but hardly a bank breaker.


Q: So high oil prices don't matter to the economy?


A: Yes, they do. Higher energy prices drive up the cost of many things. They reduce what people can spend on other things. Because consumption drives two-thirds of U.S. economic activity, Wall Street frets that high energy prices might lead to recession.


-- Kevin G. Hall, McClatchy Newspapers

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