If you feel a little lighter in the wallet, there’s good reason.
Last month was the most expensive January on record for gas prices, and experts say there’s no end in sight as fuel prices likely will push toward $4 a gallon by spring.
Last week, the current national average is $3.48 a gallon for regular grade gas. In New Jersey, that average is slightly lower at $3.42. In Toms River this week, prices are ranging from $3.38 to $3.45.
Prices have been on the rise since late November and have steadily climbed through January, bucking longtime trends and defying conventional logic that pairs historically low demand with lower prices, according to Tom Kloza, chief oil analyst at the Oil Price Information Service.
“It’s a little bit unusual,” Kloza said. “Demand stinks traditionally in January and all the data indicates that it stinks to high heaven this year.”
The oil price service, which provides the Automobile Association of America and other major organizations with the national average gas price information, is based on Route 138 in Wall Township.
Nationally, the average price in January for a gallon of regular-grade gas was $3.37. Last year, it was about $3.10. In 2010, $2.71, according to Kloza.
The prices for regular-grade gas averaged $3.51 a gallon in 2011, the highest annual price ever, representing more than twice the price average in the first four years of the century, according to the service.
But demand is at historically low levels, Kloza said. So what’s driving the higher pump prices?
Blame demand in the rest of the world, along with some speculation and a little bit of fear, Kloza said.
“The world’s appetite for oil is still very good,” he said. “And demand is colored a little by fear Isreal may be striking out at Iran, which could cause some problems at the Straight of Hormuz.’’
Iran has threatened to cut off access to the Straight of Hormuz, a narrow sea passage between the Gulf of Oman and the Persian Gulf and a major pathway for oil destined for the United States.
“When gas prices are above $4, it has a huge impact on consumer confidence,’’ Kloza said. “I think $3.75 to $4.25 to be a logical peaking spot for the spike, and I emphasize spike.’’
Drivers should expect to see prices to fall once that high mark is reached, Kloza said.
And while New Jersey drivers typically pay less at the pump than their Midwestern counterparts, that may not be the case this summer, Kloza said.
The Northeast is considered a “hot spot’’ for gas prices this coming season, he said, as refineries that normally provide gas to the region close. Two on the Delaware River are slated to close, along with one in the Virgin Islands. Couple that with several key refineries in Europe and the northeast U.S. may be looking at higher gas prices than normal, Kloza said.
“Gas will be cheaper in the center of the country,” Kloza said. “Significantly cheaper prices than we see on the coast.”
2000-2011 Annual U.S. Gasoline Averages*
- 2000 -- $1.5008 gal
- 2001 -- $1.4397 gal
- 2002 -- $1.3497 gal
- 2003 -- $1.5587 gal
- 2004 -- $1.8427 gal
- 2005 -- $2.2654 gal
- 2006 -- $2.5667 gal
- 2007 -- $2.7892 gal
- 2008 -- $3.2512 gal
- 2009 -- $2.3481 gal
- 2010 -- $2.7819 gal
- 2011 -- $3.5104 gal
*Source: Oil Price Information Service