Warning! $7 Gas May Be on the Way

By: CBS News
By: CBS News

(CBS) - A new energy report predicts $200-a-barrel oil in as short a time as two years. If that happens, gas would likely go up to $7 a gallon - and that would have an enormous impact on the way Americans live

Mitchell Igelko in Miami complains rising gas prices are threatening his 20-year-old landscaping business. His two biggest trucks sit idle - he can't afford to fill them up. Right now, Igelko's business averages $30,000 a month in gas - at $7 a gallon, that would jump to about $50,000 a month.

"I think at that time, I'm gonna put a sign 'gone fishing,'" he said.

Economist Jeff Rubin predicts the $7 mark will arrive by the year 2010.
Hardest hit will be those for those making less than $25,000 a year. For them, gas will go from 7 percent of their income to a whopping 20 percent.

"People are going to be spending more on gas than they are on groceries," said Rubin. "And that's not a sustainable choice."

In fact, by 2012, higher prices could send an additional 10 million vehicles off the road.

It would certainly ease congestion. Having that many cars come off the roads is like permanently parking twice as many cars as there are in the whole state of New Jersey. Some look to Europe for solutions to the skyrocketing gas prices.


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