Jeffrey Tomich: Good afternoon. Looks like gasoline in St. Louis and Missouri suburbs is in the high $3.80 range and Illinois long ago surpassed the $4 mark. Oil is $136 a barrel. I'll get this started before prices go up any further...

Art: If I remember correctly gas was somewhere around $2 a gallon two summers ago and at that time we thought that was high. What I don't understand is how there can be a 200% increase between now and then? I realize the dollar is down from then, but this smells like the Middle East is price fixing by manipulating the supply to me. Don't we have negotiating chips to play hard ball with them?

Jeffrey Tomich: The short answer, as you probably know, is oil. The price of oil 2 years ago today was $72. There's 42 gallons in a barrel, so the $64 difference roughly translates to a $1.50 increase at the pump. Part of the rise in oil prices is the dollar. The Federal Reserve Bank of Dallas said recently that "exchange rate movements accounted for roughly a third of the $60 increase in oil prices from 2003 to 2007." You can read the entire commentary on oil prices here: http://dallasfed.org/research/eclett/2008/el0805.html

A bigger factor, analysts say, is supply and demand. Americans are driving less these days, people are buying more fuel-efficient cars and the U.S. Energy Information Administration and International Energy Agency continue to revise downward their estimates for global oil demand. But the fact remains that oil demand is still going up. When you say Middle East, I assume you mean Saudi Arabia, the world's biggest oil producer and a member of OPEC. Many have made the case that Saudi doesn't have much spare production capacity these days.

Mike Gessel: In an effort to use less energy and to ease the burden on our employees, we recenctly began working extended hours Monday through Thursday and closing Friday. Have many other companies attempted this? What has been their experience? Our biggest concern is that we do not want to diminish our ability to provide our customers the best service possible. We will be monitoring that closely.

Jeffrey Tomich: Good question, I haven't seen any studies showing how many companies are taking similar steps, but you're obviously cutting down on your employees' trips to and from work by 20%. Like you, I'm curious to know what other creative ways businesses and individuals are coming up with to cut their fuel use. For what it's worth, yesterday the Energy Department predicted gasoline prices would peak at $4.15 a gallon nationally in August and average $3.92 a gallon in 2009. In other words, it doesn't seem like these prices are going away.

Richard Mirkay: What can be done to limit the amount of speculation in the oil market?

Jeffrey Tomich: Interesting question. Well, Congress and the Commodities Futures Trading Commission, which regulates oil traders, say they're looking to make sure oil markets aren't being manipulated. There's been talk about hedge funds and banks using loopholes in federal trading limits to buy huge amounts of oil contracts. And commodities -- not just oil -- have become a more popular asset class these days with the economy and credit crisis weighing on the stock and debt security markets. It'll be interesting to see where this all leads.

cathy: I say buy a hybrid. My little car gets 48 miles to the gallon. I brought it right before the gas prices went up.

Jeffrey Tomich: Hybrids certainly are getting more popular with these prices. There are also plenty of non-hybrids that cost less and do very well on mileage. Here's a link to Edmunds top 10 fuel-efficient sedans for 2008.

http://www.edmunds.com/reviews/list/top10/125477/article.html