$120 Oil: The Breaking Point for Consumers?

Some OPEC members may see oil prices peaking at $120 a barrel but in some parts of the U.S. it's already there or higher. The Iraqi Oil Minister said Monday that $120 oil is an "acceptable price" that will not hinder global growth. But many analysts disagree, saying $120 is the breaking point for consumers, which would halt the recovery.

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Even before escalating tensions in the Middle East and North Africa made headlines, which sent oil prices back above $100 a barrel, several investment firms, including BlackRock, acknowledged oil prices would likely rise to $120 or higher this year.

The unfortunate truth is, we're already close to that breaking point in many regions in the U.S. already. On the gulf coast, prices are hovering around $118 a barrel. West coast prices are trading around $115 and here on the east coast, prices have topped $122 a barrel, according to Lipow Oil Associates. As a result, gasoline prices in some regions are spiking higher than the national average of $3.55/gallon.

Prices at the Pump (National Average)

Today $3.55

Last Month $3.17

Last Year $2.82

Trader Anthony Grisanti of GRZ Energy expects 10 to 15 cents more on the upside for gasoline prices, but that's it because demand isn't where it was 3 to 4 years ago. "As prices head higher, people make adjustments on their buying," he says. Plus, there's plenty of gasoline out there. By Memorial Day, Grisanti is expecting prices around $3.75 to $3.80 a gallon, but not the dreaded $4.00.

However, $4 gasoline is already here for some U.S. consumers.

In the past month alone, the national average for regular gasoline has jumped 12 percent . Prices have creeped up to $4 a gallon or more in Alaska, California and Hawaii. Many other states may not be too not far behind.