By Brittany Pieper – email
SHREVEPORT, LA (KSLA) – Some economists think gas prices could increase 5-10 cents a gallon by Thanksgiving because of new plans announced this week by the Federal Reserve.
As the holidays approach, lots of people make travel plans, but rising prices at the pump mean
Ossie Browder won't travel beyond the Ark-La-Tex this year.
"I would love to, but it's too high," she said.
On Thursday, AAA reported regular unleaded gas averaged $2.80 a gallon in the U.S. That's $0.07 more than a month ago, and $0.12 higher than this time last year.
Centenary College Economics Professor, David Hoaas, says prices always rise a little around the holidays because of supply and demand, but this year some decisions by the Federal Reserve are adding to the cost increase.
"Basically what they are doing is buying bonds, bonds that individuals and corporations hold. They're buying them with dollars, putting more dollars into circulation," said Hoaas.
The Fed plans to spend about $75 billion in bonds per month through the middle of next year. While this may increase spending, it also causes inflation. That inflation makes the dollar is worth less on the global market.
"We're going to have to pay more for imported crude oil products, therefore pushing up the price of gasoline," said Hoaas.
Paying more for crude oil translates to higher prices.
"I think it's ridiculous. The prices are too high, and everything going up except for your paycheck," said Browder.
Higher gas prices could also impact the rest of your holiday spending.
"To get products to the Shreveport Bossier community they have to be shipped in. Our primary means of getting products here is through the trucking industry. Obviously trucks require gasoline, so we'll probably see an across the board increase in prices as we bring more products in for the holiday season," said Hoaas.
The cost of heating oil and natural gas also went up Thursday, so you will likely see a similar increase to heat your home this winter, too.