Californians are still learning to cope with $4 gasoline. Will they soon have to deal with $5?In the two weeks since California's average price for regular gasoline passed $4 per gallon, prices have jumped an astonishing 42 cents. Some cities have seen increases of 5 cents or more overnight, according to data from the American Automobile Association.Without a doubt, $5 gas would pose yet another significant psychological milestone forcing Americans yet again to look for ways to scale back consumption.Still, most analysts don't think we'll see $5 gas this summer. Americans have been so stunned by this decade's run-up in prices that they've finally started driving less, and the drop in demand for gasoline should keep prices from passing the $5 milestone, analysts say.But no one wants to sound too sure. Not after watching California's average gas price cross $3, then $3.50, then $4 in just three years."Five dollars? I don't see it happening," said Denton Cinquegrana, who tracks West Coast gasoline markets for the Oil Price Information Service. "Demand is just so (crummy) right now. But I've been wrong before."Even if it doesn't hit $5 this year, it's possible in 2009 unless oil prices drop."Maybe not by the end of the year, but certainly within a year we'll get there," said Rod Diridon, head of the Mineta Transportation Institute at San Jose State University.He worries how low-income families will cope.The shock of $4 gas has already forced many Americans to adjust, by trying mass transit or buying more fuel-efficient cars or working from home. But some of those options aren't available to people with low-wage jobs. If gas goes to $5, those people may not be able to pay, Diridon said."There will be pressure on the average American and the wealthy American, but for the poor, that pressure will be strangulation," he said. "It won't be, 'Gee, this is expensive.' For them, they won't be able to afford the car."Prices have already climbed high enough, and stayed there long enough, to force Americans to rethink their daily routines.A recent survey of 43,000 people nationwide found that 12 percent had tried carpooling to cope with high gas prices, while an equal percentage had canceled vacations as a result. About 8 percent had started using public transportation.The survey, conducted by the NPD Group market analysis company, also found consumers making far more fundamental changes. About 6 percent of respondents had purchased more fuel-efficient cars, 6 percent had switched to telecommuting and 5 percent were working closer to home."Those are things that people don't just wake up one day and decide to do," said David Portalatin, director of industry analysis for NPD. "But now we're three years into this increase, and that's long enough for people to start making changes."Those changes have started cutting the amount of fuel America consumes. In the past four weeks, the country used 1.6 percent less gasoline than during the same period last year, according to the U.S. Energy Information Administration.The thrift of drivers, in turn, has kept gasoline prices from soaring even higher. Gas-station owners paying higher wholesale costs for fuel have a hard time passing along the full increase to their customers if those customers are buying less each week.Mark Mitchell, president of the Coast Oil fuel marketing company in San Jose, said retail gas prices would have to hit $4.49 per gallon for an independent station owner in California to break even right now."These have been the toughest four months I've seen," Mitchell said.Although prices have been rising across the country, they've climbed higher and faster in California than in most states.(E-mail David R. Baker at dbaker(at)sfchronicle.com.)(Distributed by Scripps Howard News Service, www.scrippsnews.com.)
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Will Californians soon be paying $5 a gallon for gas?
Submitted by SHNS on Mon, 06/09/2008 - 15:40
Paying taxes unites us. It also divides us. People can pay five and even six times more in state and local taxes than other folks in similar circumstances making similar incomes.
Who's got your number?
In one of the fastest-growing forms of identity theft, crooks are stealing tax refunds by swiping personal information and using it to trick the Internal Revenue Service.




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