This is a record we could gladly do without.
Gasoline prices in the Chicago area shot up to their highest level ever recorded by AAA Monday, but relief may be coming.
The average price of unleaded regular gas in the Chicago metropolitan area was $4.51 a gallon, surpassing by 4 cents the high of $4.47 reached May 5, 2011, according to AAA, Wright Express and the Oil Price Information Service.
In the city of Chicago, the average price hit a record $4.67 a gallon Monday, the highest in the continental U.S. and up a penny from the $4.66 high that also was reached last May.
“It’s ridiculous,” said 29-year-old, downtown Chicago resident Josh Alcaraz as he pumped gas at the BP station at 35th Street and Martin Luther King Drive Monday. There unleaded regular was nearly $4.70 a gallon.
“I don’t even like looking at it anymore,” he said, adding it costs him around $100 to fill up his Mitsubishi Montero.
The good news for Chicago area drivers is that the record prices could be short-lived. Oil trading analyst Phil Flynn of the brokerage PFGBest said wholesale prices rose sharply over the last two weeks on a pipeline disruption and problems at refineries, including a reputed glitch at BP’s operations in Whiting, Ind.
Flynn said overnight wholesale prices Monday fell 20 cents a gallon, a sign that the supply pressures were leveling off. Overall, the oil market has moved prices higher on unrealized fears of a Mideast conflict linked to Iran’s nuclear program.
In New York trading, oil rose 26 cents Monday to close at $107.13 a barrel.
The average price of unleaded regular gas in both the Chicago metro area and the city of Chicago jumped 18 cents a gallon from a week ago Monday and are more than 70 cents a gallon higher than a year ago.
To lessen the pain, Alcaraz has switched from using premium to regular gas.
“I try to drive less,” he added.
On Facebook, Sun-Times reader Ron Richter, who lives in the Fox Lake area, said, “I have to drive BUT will make at least one trip by train this week. Metra.”
Since gas prices shot up, it appears Metra may be seeing an increase in passengers despite the average 25 percent increase in fares that went into effect this year, said spokeswoman Meg Reile.
“Normally when you have a fare increase, the largest percentage wise in our history, you would expect to see some drop off,” she said. “What I’m being told anecdotally is that has not occurred. Preliminarily what they’re looking at is showing an uptick in ridership.”
Americans have pumped less gas every week for the past year, pushing gasoline consumption down by 4.2 billion gallons, or 3 percent, according to MasterCard Spending Pulse. Some of that decline in consumption can also be linked to efforts that pushed car makers to produce vehicles with better gas mileage. The average car now gets nearly 24 miles to the gallon, up from 20 mpg just four years ago, according to the University of Michigan Transportation Research Institute.
Airlines are feeling the impact of higher oil prices and looking to pass them on to consumers. Southwest Airlines said Monday it’s raising ticket prices between $4 and $10 per round trip to offset the high cost of jet fuel. It’s the airline’s third increase this year, and spokesman Brad Hawkins said it’s all due to higher fuel costs. J.P. Morgan airline analyst Jamie Baker said he expects all other U.S. airlines to quickly match the latest increase.
High gasoline prices have yet to affect people’s overall spending, contends William Strauss, senior economist at the Federal Reserve Bank of Chicago. He said that’s mostly because of a little appreciated “cushion,” that is the savings on heating bills over the winter.
“People went through the winter spending a heck of a lot less heating their homes,” Strauss said.
Indeed, much of the country had an uncommonly warm winter, and natural gas prices are at 10-year lows.
But 41-year-old Chicagoan Armeker Wright, said she’s still feeling the impact at the pump.
“It hurts,” she said. “I’m a family of five, a single parent with four kids, running to different schools having to drop them off.”
She said she’s doing more walking to cut gasoline costs, and that has had a bright side.
“I lost ten and a half pounds because I’m doing more walking,” she shared. “So that’s a good thing.”
Managers of businesses that draw customers from a wide area said they have not seen a reduction in driving. At Woodfield Mall in Schaumburg, General Manager Marc Strich said he spoke with about 30 of his retailers Monday and
not one mentioned gas prices.
The mall’s business is running ahead of last year’s pace, he said. Strich said that after prior spikes in gas prices, he noticed many extending each visit by hitting more stores, and so far that hasn’t happened this year.
At the Key Lime Cove resort in Gurnee, the two-to-three weeks of spring break is just hitting and bookings are at or near capacity, said Marketing Manager Jennifer Evans. She said there’s an early sign of people trying to get more from their trip.
“We’re still looking at this, but people who are driving in from Chicagoland may be staying a little bit longer than we’ve seen in the past,” she said.