Already high, gas prices threaten to go higher 

Geopolitical instability contributed to this week’s all-time high oil prices, prompting a likely hike in Bay Area prices at the pump.

In the greater San Francisco area, which includes portions of San Mateo and Marin counties, the average gas price is $3.22 a gallon, according to the AAA.

With oil prices reaching $75 a barrel Wednesday before dropping off slightly Thursday,the average per-gallon gas price may soon exceed Bay Area records set in May, said Denton Cinquegrana, West Coast markets editor for Oil Price Information Service.

The average price of gas in San Francisco reached $3.38 a gallon in mid-May.

Demand for gasoline continues to increase nationwide, according to the U.S. Energy Department.

The government’s national data shows gasoline demand in the past four weeks at 9.5 million barrels a day, 1.4 percent higher than the same period a year ago. Meanwhile, some Bay Area drivers are shortening pleasure trips to save money, AAA reported.

That’s not likely to stop an upcoming price hike in and around San Francisco.

"Before Labor Day we will probably revisit" the highest prices set in May, Cinquegrana said. "We may see new records or just fall shy of those."

That’s not good news for taxi driver Baldev Merdha, who spent $26 to fill his tank at a station at Harrison and Sixth streets Thursday afternoon.

Merdha says he’s just breaking even during his 10-hour shifts, despite losing about $15 per day due to higher prices.

A gallon cost an average of $2.43 a year ago in the Bay Area, according to the Metropolitan Transportation Commission.

Simon Lehbohn recently traded in his BMW and started riding a motorcycle, which costs him about $4.50 a week to fill with fuel, he said Thursday.

He chided his friend, Joey Strulowitz, for driving a gas-guzzling Hummer, which cost $71.61 to fill up at a SoMa gas station.

Bay Area drivers are cutting back slightly on the amount of gasoline they use during their vacations, said Sean Comey, a spokesman for AAA.

"People are traveling closer to home and taking fewer vacation days," Comey said. "I suspect it has something to do with the way their money is spent."

When gasoline prices rise, many people have less discretionary money to spend on holidays, Comey said.

For instance, a three-day trip may be planned instead of a four-day voyage, Comey said.

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