Oil, gasoline high and getting higher

By the end of the year, consumers may think what they pay at the pump now is cheap.
Top economists for Global Insight, a Boston-based economic and finance research firm, issued reports today upping their forecast for crude prices.Chief economist Nariman Behravesh and economist Sara Johnson say crude is expected to peak at $160 a barrel by December, up from a previous forecast of $124 that was left in the dust in May. They also say prices will remain high through mid-2009, fall to $130 a barrel by the end of next year, and then fall to $105 by the end of 2010.
That means average per-gallon gasoline will hit $4.50 by the end of this year, according to Nigel Gault, the firm’s chief U.S. economist.
Add a significant supply disruption to the mix, or more heated tensions between Iran and Israel, and the jittery market could blow past those levels in nothing flat.
Today crude for August delivery closed up $2.60 at $143.57 a barrel on the New York Mercantile Exchange. AAA says the national average price for a gallon of regular unleaded gasoline rose a penny to $4.09 today _ up more than a buck from the $2.95 a year ago. The Texas average also rose a penny to $3.95, but Houston’s average remained at $3.92 – at least for now.