Oil Is Plentiful, Demand Weak. Why Are Gas Prices Going Up?

Why are Gas prices going up ?

Fears that the turmoil in Egypt could disrupt oil shipments passing through the Suez canal and engulf the Middle East drove the price of Brent crude oil through the $100 barrier for the first time in over two years.

The price of a barrel of the benchmark Brent crude soared by more than $1.50 to as high as $101.08 a barrel as the protests against President Hosni Mubarak's regime intensified. Prices are now at their highest since September 2008, at the start of the financial crisis.

Abdullah Al-Badri, secretary general of Opec, the cartel of oil producers, expressed concern about the situation in Egypt and added that Opec did "not want 2008 to be repeated", referring to when oil prices hit a record $147. But he said the cartel would not increase production on the back of the surge in prices as he believed there was no shortage of oil.

Since August, oil prices have been steadily increasing from around $70 on the back of higher demand as the global economy recovers from the downturn, fuelling inflation.

The latest rise in oil prices will put further pressure on the British government to head off a rise in fuel duty planned for April.