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Libyan conflict drives up gas, consumer prices

February 23, 2011 12:00:00 AM PST
Gas prices have shot up, driven by the instability in Libya. How high will they go? Some industry analysts say we could see $4-per-gallon gas by midsummer.

And it doesn't stop at the gas pump. Prices on just about everything else, from pizza to produce, will also rise.

Gas prices have been inching up on a regular basis and soon it will get worse, with oil up another $3.50 per barrel Wednesday.

With every dollar increase in oil prices, you can expect 2.5 cents more per gallon at the pump. Already the average price in the Southland is $3.57 a gallon.

"My cost of a load of fuel is $21,000, let's say six weeks ago. Today it's $30,000," said gas station owner Andre Van Der Valk.

And if the gas station owners are paying more, then you can expect others will too.

Every truck you see on the road gets from point A to point B because of diesel fuel. If the trucking company has to pay more for its fuel, then eventually they'll pass that cost on to the consumer.

More than 70 percent of all freight goes by truck, including much of our food. So if gas prices continue to rise, you can expect to pay even more for such things as fruits and vegetables.

Do you like to get your pizza delivered? More than 1 billion are delivered each year. Most of the time it's free delivery but expect either a delivery charge or an increase in the cost of the pizza if the pizza-maker has to pay more for gas.

"Drivers sometimes don't want to go far because of the gas, so that makes us have to pay them more mileage, and since business is down, it's not good," said Agnes Perez, a Domino's Pizza assistant manager.

If you have a membership, Costco may have the cheapest gas right now. Wednesday, there were waiting lines at one Costco gas station.