Oil prices hit nine-month high

NORTHAMPTON, Mass. (WWLP) - Oil prices hit a nine-month high Monday after the Iranian government stopped exporting crude oil to some European nations.  

$105, that's the price for a barrel of oil; the highest its been since last May.  It's a cost that is set to trickle down to consumers in Western Massachusetts. And against the backdrop of rising tensions in Iran and shaky investor confidence; the price of oil is becoming a concern.

“How do you afford it? I mean look at the gas prices now, you have to talk about heating a home. I don't know how people are doing it,” said Richard Samuelson of Southampton.

The average price for a gallon of gas in Massachusetts is $3.63, $0.50 higher than this time last year.  Heating oil is even more expensive, a gallon is $3.83, up $0.44 cents from last February. Michael Sobon is the CEO of O'Connell Oil in Northampton.  He told 22News his sales have dropped 25 percent.

“It is what it is, the market is not dictated by us is dictated by the majors and it's ironic that gasoline is cheaper than fuel oil,” said Sobon.

Even gas stations are feeling the economy's pinch.  In an effort to attract more customers, a gallon of gas at the Racing Mart in Northampton is $0.05 cheaper than the state's average.

“We don't make too much money on gas. We try to bring more customers inside. I drive twice a day to Easthampton and Northampton, check all stores and what is the lowest price [then] I try to go one or two cents down,” said Atif Tasneem who owns the station last February.

In the coming months the question is, will this halt in crude oil sales from Iran lead to higher gas prices in the United States? Some analysts say yes, as they forecast a gallon could hit $4.00 before the summer.