According to A.F. Alhajji, an energy economy expert and associate professor at Ohio Northern University, gas prices could hit $4.50 a gallon if we experience a severe hurricane season and a heat wave in the Gulf region during the 2008 summer season. .

Why is this happening? First of all it is important to understand that this is not a new phenomenon. It has been guillotine waiting to fall since the gas crisis back in the mid seventies when those of us who are older remember sitting in long lines on even/odd days to refuel our vehicles. More recently, one can look to the spring of 2004 where you will see that was when gas prices first skyrocketed and never went back down. At the time the rise was blamed on the Iraq War machine or on oil companies gouging the public to increase their bottom line. However, those were just a couple of things that were at fault.

In fact, oil companies like the rest of us are at the mercy of OPEC and have little control over the price of oil but before you decide that war against the Middle East is the only answer you must understand that even OPEC has no control over supply and demand. Demand plays a major factor for everyone involved in producing oil and when it is high the price goes up. Here’s the relationship between oil and gas prices. Generally, for every dollar increase in oil prices, gas prices increase by 2.4 cents. If oil rises $10 dollars, consumers will pay 24 cents more at the pump.

One reason that the price has risen with the growing demand is that crude oil itself is getting trickier to access because the regions where it is available, like Nigeria, Iran, and Iraq, are increasingly unstable. This makes it more difficult for oil producing countries to fulfill the needs of an oil-hungry world who not only want fuel for their vehicles but to keep their industries producing all the goods that consumers demand.

What one might not realize, however, is that while oil itself is pricey refining the crude to a usable state adds more than 50% to the cost. For the U.S. this is even more costly as we do less of our own refining than other countries do. In the last few years President Bush has asked the Saudi King to produce more oil and his response was that he would gladly sell us as much oil as we wanted but it would not do us any good since we lacked the refineries to process more than we were already receiving. The reason for our lack of refineries is in part due to increasingly stricter EPA regulations that have made oil refining more costly and thus less profitable for the big oil companies to do it stateside. This along with the problems they encounter as the result of natural disasters such as hurricanes Rita and Katrina from which the oil industry still hasn’t recovered has made the refining process more tricky.

So what can you do to save a few bucks when you fill up your car? Well, the first step is fairly obvious, drive a 4 cylinder car instead of a larger one. This is bound to save you money on gas. Next buy the lowest grade of oil available. For most cars the difference between grades is relatively insignificant and will not affect the way your car runs. In our area we have a gas station that sells premium for the same price as the regular octane so look around and you might find the same type of station where you live.

Once you have filled your car you can also save gas if you drive slower. The EPA estimates that for every 5 miles per hour over 60 that you drive, you burn about 20 cents more gas. Also while driving under 60 mph make sure that your car is in high gear because the slower your engine turns over, the less gas you’re using. Increase the efficiency by avoiding accelerating quickly and coasting whenever possible.

 Next drive less. According to CNN Money, this is already being accomplished through the rise in fuel costs as Americans drove an unbelievable 11 billion miles less in March of this year than they did in the same month a year ago. Another money saver is to avoid excessive idling. If you are in line at a road repair or a fast food restaurant that is not so fast shut off your engine until you are able to move.

Lastly, you should try to take advantage of companies, like auto dealers or credit card companies who are trying gas promotions to get you to spend money. To find out who’s participating, check out bedandbreakfast.com. Plus, hotels like Mariott and Hilton are offering gas cards if you book with them.

In Minnesota there is even a company called First Fuel Bank that allows you to lock in gas prices. To participate you actually pay for the amount of gas you want prior to needing it. Example: you pay for $500 worth of gas at $3.00 a gallon and whenever you fill up you get the gas for that price until you have depleted your account. Then you have to start over but in the meantime you could save a lot of money.

I hope that this information will be helpful to you. If I discover other clues as to how to save money on fuel costs I will update you with another article.