One year ago, East Coast drivers paid $1.74 per gallon for regular gasoline. Average prices are now 49 cents higher and, at the beginning of this busy-driving summer season, the increases have not stopped yet. According to the Energy Information Administration (EIA), prices for regular gas are expected to peak at $2.35 per gallon in May.

“The thing that’s driving it right now is demand,” said Professor of Economics Bob Williams. “In the past, supply has generally caught up to demand, but it takes time to find the oil, drill it, and get it to the markets.”

Like any economic exchange, supply and demand dictate oil prices. If there is more oil than people need, prices drop. They rise when supplies decline or demand increases.

Unfortunately, now the world is experiencing both a reduction in supply and an increase in demand.

“Investment to convert reserves to productive capacity has fallen short of the levels required to match unexpected recent gains in demand, especially gains in China,” said Federal Reserve chairman Alan Greenspan, according to federalreserve.gov.

China’s growing need for oil makes oil more valuable. But despite this stretching of resources, U.S. gas use is still expected to rise 1.8 percent from last summer to an estimated 9.3 million barrels per day, according to EIA.

“Higher prices in recent months have slowed the growth of oil demand, but only modestly,” said Greenspan.

The American Automobile Association (AAA) reported a survey conducted two years ago for CBS News, finding that SUV owners would have to pay more than $3 per gallon to consider buying a more fuel-efficient car.

“People have these SUVs, but we have all these gas problems,” said senior Clark Doherty. “People complain about them, yet they still buy these cars.”

Despite the shock of what seems like an out-of-control fuel situation, prices are not the worst in history.

“Even though the pump price is higher than it was 25 years ago, it’s still cheaper than it was in the late 70s and early 80s,” Williams said.

When adjusted for inflation, those prices were about $2.50 per gallon.

“The oil market has always had tremendous volatility,” Williams said. “But the general trend is no question – up. We are going to increasingly pay higher prices.”

“I don’t really have a choice,” said senior Lauren Lippincott. “You just have to suck it up and try to limit your driving – like don’t drive to Teeter.”

The problem is not that we are running out of oil. Economically speaking, the issue is that the easy-to-get oil is all but gone. The more difficult-to-drill alternatives will cost more at the pump.

“But if history is any guide, should higher prices persist, energy use will over time continue to decline,” Greenspan said.

Just like the interplay between supply and demand, higher prices catalyze increased effort into conservation and efficiency. This is how Japanese cars got into the American market in the 1970s – the country hit a gas crisis and American cars were not as fuel-efficient.

“To some extent, the difficulty in getting as much gasoline as we want is a good thing,” Williams said, “because, given the chance, we would all just blow it out our tail pipes and add to the problem of global warming.”

More than just a problem, experts say greenhouse gasses must be reduced 50 to 80 percent in the next 100 years to avoid an environmental catastrophe, CNN reports.

“It hurts me like it hurts everyone else,” said Williams, “but I see it positively because the prices are going to help many of us make decisions that will make things better down the road.