Economists are concerned that surging oil prices could adversely affect consumers and possibly devastate an economy that's gaining traction after more than two years in the doldrums.
Weekly retail gasoline prices skyrocketed to $3.19 a gallon, according to the Department of Energy. The price spikes are being driven by the popular revolts spreading across the Middle East.
Daniel O'Connell, vice president of energy at MF Global, said if gas prices continue to accelerate ahead of May, when "driving season" picks up, "it will cripple the economy."
The U.S. weekly average price per gallon was up 54 cents from a year ago, and slightly higher than last week's $3.14. This was the highest weekly price posted during the month of February since 1990, from available data. The most expensive regions again are New England at $3.23 and California at $3.56.
On Tuesday, oil surged to $93.57 in New York trading, up 8.5 percent since Friday's close, the biggest one day jump in nearly three years. Wednesday's price rose anther 2 percent by late morning.
O'Connell said if crude oil does reach the brief high of $147 a barrel from July 2008, then the price of gas could also average $4.11 as it did then. In that scenario, he said consumers and retailers would not be able to absorb the higher gas prices as they did three years ago.
However, O'Connell said he does not suspect gas and oil prices to continue to accelerate for very long.
"It's going way up way too fast," said O'Connell.
And why are gas prices going up?
"In a word: Libya," says petroleum expert Andrew Lipow, president of Lipow Oil Associates in Houston. He has been following gas prices one way or another for more than 30 years.
As protests seemed to subside in Egypt, anti-government unrest continued in Bahrain and Libya. In a speech on Tuesday, defiant Libyan strongman Moammar Gadhafi said he maintains control of the country despite the spread of anti-government protests from the city of Benghazi to the capital, Tripoli, yesterday.
Unlike Egypt and Bahrain, Lipow says, Libya is a significant exporter of light sweet crude.
Most of that gets exported to Europe: Italy, Germany, France and Spain. So, how does it affect the United States? We import 40 percent of our crude from Europe, refine it, and then export back to them the distillates, including gasoline and diesel. So, any disruption in Europe gets felt in the 50 states.
"You hear that we import a lot of crude," says Lipow. "And yes, we import about 9 million barrels a day. But less than 1 percent of that comes from Libya. What the oil market is worried about now is, we've seen unrest spread throughout the Middle East -- Morocco, Algeria, Tunis, Egypt. What if that should spread to Saudi Arabia, which accounts for 9 percent of the world's supply? They are the supplier of 11 percent of our crude oil. The market is worried about that supply being disrupted."
Oil prices jumped above $93 a barrel in Asia today amid fears the violent protests in Libya could disrupt crude oil supplies. Weekly gas prices are expected to be released later this afternoon.
"Oil hates uncertainty. It hates political turmoil," says John Hoffmeister, CEO of Citizens for Affordable Energy and the former president of Shell Oil. "And traders will be having customers buy it as quickly as they can to lock in supplies, and that drives the price up."