Crude, Fuel Prices Ascend to New Record Highs

Phoenix, Ariz., May 8, 2008 – Across the state and country, gasoline prices continue to ascend for the third consecutive month. While Arizonans continue to pay the second lowest fuel price in the country, the current statewide average increased by over two cents since last week to $3.471 per gallon. Tucson drivers have reclaimed the state’s lowest fuel price at $3.409 per gallon, while Flagstaff drivers continue to pay the most to fill their tanks at $3.577 per gallon. Nationwide, the current average for a gallon of regular unleaded gasoline is $3.645 per gallon, also an increase of over two cents from last week.

This week, the Department of Energy released its revised short-term outlook for both crude oil and gasoline prices. The agency now predicts that gasoline prices will peak in June at $3.73 per gallon and will average $3.52 per gallon for the remainder of 2008. The agency also increased its estimate for the average price of crude in 2008 from $101 to $110 per barrel, while investment firm Goldman Sachs said it is not beyond the realm of possibilities for oil to reach $200 per barrel by the end of the year.

“We are not forecasting a huge leap in the price of oil this summer and will continue to refrain from ‘talking the price up’ for the benefit of oil producers and speculators, or predicting scenarios that imply a rapid rebound of the dollar which would drive commodity prices sharply lower,” said AAA Public Affairs Manager Linda Gorman. “Despite the market’s volatility, these extreme scenarios are unlikely given the current environment. However, fuel prices will likely continue their ascent for at least the next few weeks.”

The cheapest gasoline in the continental United States is in Wyoming, where unleaded regular is $3.464 per gallon. California drivers continue to pay the most for fuel in the country at $3.924 per gallon.

Motorists can visit www.AAAAZ.com/news/fuelnews.htm for the latest fuel price information and gas saving tips and go to www.AAA.com/fuelfinder to locate the station with the cheapest gas in their neighborhood or along their commute route.  They can also visit AAA’s Fuel Cost Calculator at www.fuelcostcalculator.com, which can help drivers plan out their fuel costs so they can budget their travel expenses in advance. AAA members who use their AAA Visa credit card can get a rebate of up to five percent on gasoline purchases made at the pump. Members can also flash their AAA membership card to save at over 100 of the auto club’s Show Your Card & Save partners.

 **The BTU-adjusted price of E-85 is the nationwide average price of E-85 adjusted to reflect the lower energy content as expressed in British Thermal Units - and hence miles per gallon - available in a gallon of E-85 as compared to the same volume of conventional gasoline. The BTU-adjusted price calculated by OPIS and AAA is not an actual retail average price paid by consumers. It is calculated and displayed as part of AAA's Fuel Gauge Report because according to the Energy Information Administration E-85 delivers approximately 25 percent fewer BTUs by volume than conventional gasoline. Because "flexible fuel" vehicles can operate on conventional fuel and E-85, the BTU-adjusted price of E-85 is essential to understanding the cost implications of each fuel choice for consumers.

AAA Arizona’s Weekly Fuel Gauge includes data from gasoline stations in every Arizona community. However, only major metropolitan areas are shown in the table above.  Local prices in some communities might be higher or lower than the averages shown here.

NOTE: AAA Fuel Gauge data may be used on a daily basis by news media Web sites, but should include attribution to AAA.