Although gas prices have risen in Ames recently, gas station employees said they expect prices to remain fairly constant in the next few months. Gas prices skyrocketed in the Midwest earlier this year to about $1.70 per gallon, but by late summer the prices had fallen below $1.30 per gallon in the area. In the last two weeks, however, the price of gas in Ames has increased to about $1.50 per gallon at most stations. Daniel Otto, professor of economics, considers the rise in prices to be seasonal. He said they increase as utilities companies start to stock up on heating oil for the colder weather. Otto said gas is a product with inelastic demand, meaning the demand for gas is not going to change regardless of price. Because of this, small changes in the supply of gas will cause larger changes in the price of gas. However, Otto said this recent increase in gas is not a general trend, and gas prices should remain at roughly its current cost in the near future. “In the long term, we’re still paying less for gas now, adjusted for inflation, than we were 15 years ago,” he said. “The price seems very high, though, due to large changes in a short period of time.” Gas station managers in Ames agreed with Otto, saying the price of gas would not go up much more than its current cost. “I don’t think that gas prices here are going to go anywhere near where they are in Minnesota,” said Lucrece Booth, manager of Kum & Go, 111 Duff Ave. She said Minnesota gas prices have reached about $1.65 per gallon. Mark Hansen, manager of Butch’s Amoco, Lincoln Way and Duff Avenue, said he sees the prices leveling off, “though it usually spikes once we start getting around the holidays,” he said. “We’ve been selling gas at cost or even below,” Hansen said. He said business has been hurting lately due to the high prices his company must pay to distributors. Otto said he doesn’t expect to see the prices declining anytime soon. “I think we’re in for another year of above-average gas prices,” he said. Ames has a high number of gas stations per capita, and because of this, pricing in Ames is very competitive, said Larry Eastman, manager of Decker’s Petro Palace, 821 Lincoln Way. “We’re one of most competitive markets in Iowa,” he said. “Every station in town is losing money on gas right now.” In Hansen’s opinion, gas pricing has become more competitive because customers don’t regularly visit the same gas stations. “Years ago, a customer would have loyalty to their station, but now, if you’re selling gas at 5 cents more than anybody else, you can’t sell any gas,” he said. The current high gas prices are essentially just a continuation of the problems that happened earlier in the year, Otto said. He said the biggest change in the future will be an increase in heating costs. The U. S. government tried to fight the price increases by releasing some of the oil reserves into the market to lower prices, Otto said. The policy lowered gas prices for a short time, but the effect has been limited in the long run. “It will take more than a few releases of oil to solve the problem,” he said. Read what Dermont Hayes, professor in agricultural economics at Iowa State University said in an AP article about fuel prices over the weekend.