WATERLOO -- Some Cedar Valley service stations were backed up with traffic like toll-booths on a big-city turnpike late Tuesday in anticipation of spiking gas prices.

At about 10:15 p.m., gas lines were backed up in Waterloo at the Kwik Star stations at the Six Corners intersection of Kimball, Campbell and Williston avenues and West Fourth Street, as well as the company station at Fletcher Avenue and U.S. Highway 63. Other nearby stations were closed. The rush occurred following broadcast media reports of gas prices topping $3 a gallon today.

Gas prices there were $2.64 per gallon for regular ethanol unleaded and $2.70 for regular unleaded. Earlier Tuesday the prices had been $2.49 per gallon. As of 7:15 a.m. today pump prices at those stations were unchanged, though there were reports of pump price hikes at other stations.

"We got pretty busy late last night ourselves," said Jim Lind of Jim Lind BP Service on Ridgeway Avenue. "We had a 43-cent increase last night," to $2.64 per gallon. "My simple mind is hoping the president is going to release some of the strategic reserves to provide some stability. This isn't just nickels. It's dollars now. I'm filling up my tanks this morning because I'm worried about shortages…Our cost is just under $3…$3.10 isn't too far off the mark."

Some stations in Des Moines are reportedly already charging $3 or more, and local gas station officials say Cedar Valley residents can expect it as well.

Officials with All Stop Inc., which owns four stations in the area, said wholesale prices have jumped 48 cents per gallon in the last two days. As of this morning, ethanol-blended fuels remain the cheapest at $2.64 per gallon, but don't expect that to last too long.

Bryan Segerstrom, All Stop business manager, said retail prices mirror wholesale prices. Energy officials have said profit margins, which are only a few cents a gallon, don't go up when prices skyrocket. If anything, the stores take short-term hits.

Combine the affects of Hurricane Katrina on domestic oil production and gas refining capability and the upcoming Labor Day holiday weekend when roads are usually packed -- demand will drive price prices even higher.

"I would say that's probably reasonable," Segerstrom said, when asked if $3 gas is on the horizon.

Several stations in town also have converted several or all of their pumps to pre-pay in the late evening hours as a hedge against drive-offs.

One local financial planner, who asked not to be identified, predicted an economic impact from Hurricane Katrina worse than the Sept. 11, 2001, terrorist attacks, tripping a cycle of rising gas prices and inflation of other items.

In Mason City, prices on Tuesday afternoon were $2.599 for super unleaded and as high as $2.739 for premium unleaded at most stations, but some were raising prices again as the end of the day neared.

"I heard it was going up by tomorrow," said Craig Eckels as he filled his Chevy Blazer at Kum & Go in Britt. "I'm thinking about investing in horses."

Eckels is one of many North Iowans hit hard by rising gas prices. As a sales representative at PSI in Mason City, he puts a lot of miles on his vehicle making calls and deliveries.

He was filling his tank in Britt Tuesday afternoon before Kum & Go raised its prices. Other drivers were also streaming to what was at least temporarily one of the lower-cost stations in the city.

"Whoever thought that $2.49 would be cheap?" Eckels laughed as the gas pump kept running. "This is crazy."

Katie Chase, 17, quickly pulled up to a pump in Osage on Tuesday afternoon when she heard rumors the price of gas was going to skyrocket today.

"I heard it was because of the hurricane and the way it hit the oil rigs," she said. "I heard it was going up another dollar by tomorrow."

Prices at 4 p.m. at Kwik Star, as well as Osage's two Casey's General Stores, were $2.599 for unleaded plus and $2.699 for unleaded. The price had gone up by 10 cents since Monday.

For Chase, it made the life of a senior in high school a bit tougher.

"The best most of us can do is work minimum wage," Chase said. "You're trying to pay for your car, your gas, and you have college coming up. This makes is a whole lot harder."