Gas prices now reach $4 a gallon

April 30, 2008 12:29:00 PM PDT
Gasoline prices have officially hit the $4 mark in San Francisco. The city-wide average crossed that costly threshold over the weekend and now stands at $3.99 a gallon, to $4. Prices in Santa Barbara and San Luis Obispo have also reached $4 and the effect on Bay Area businesses are accelerating.

"It's only getting $40 it's only getting a little bit," said a woman filling up her car.

The expression 'Pain at the pump' is no longer a cliché, it is a reality.

"It's pretty tragic, especially for people on a limited income," said Lorraine Witte, a San Francisco resident.

According to AAA, the average price of gasoline has reached a new height in San Francisco at $4 dollars a gallon for regular unleaded.

"I do think psychologically $4 is a tipping point," said Professor Eugene Muscat, Ph.D., from the University of San Francisco.

Professor Muscat is an expert on consumer behavior and trends. Now that gas has hit an all time high, he says drivers will begin making conscious transportation-based decisions. Many already have.

"I've been taking public transportation more, walking more and riding my bike. Right now I'm driving, but I only drive like once a week now," said a driver.

Professor Muscat predicts when it comes to shopping, neighborhood commercial corridors like San Francisco's Fillmore Street, will profit.

"If you think about a round trip to a mall it's now costing about $10. You'll really see a gallon of gas disappearing at $4 a clip. You're going to think about ways of shopping without travelling," said Professor Muscat.

He believes that also means internet usage will soar, not just for shopping, but eventually for other purposes like medical updates with your doctor rather than an in-house visit.

A protest over rising gas prices reached Capitol Hill on Monday when a caravan of trucks rolled past the White House.

The upswing at the pump is tied to surging crude oil prices. Oil nearly went over $120 a barrel on Monday for the first time ever, before closing slightly lower. It's still more than twice the price early last year.

"I was in the oil industry originally in my career and to even see $120 for a barrel of oil is incredible to me," said Karen Pearson, a San Francisco resident.

Pearson says she tries to buy her gas in Oakland or Marin where it's cheaper, just by a little bit, because according to AAA, the state-wide average is $3.91, 52 cents above this time last year.

On the ABC7 Futures Market our investors give $5 dollar gas in the Bay Area a 54 percent chance of happening by the end of the year.

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