Terrorist attacks in Saudi Arabia scared the price of oil futures up 43 cents to 54.63 in early trading for light sweet crude in New York. London felt the same fears as Brent crude climbed 55 cents to $54.56 a barrel.

While prices still haven’t matched the high of $58.28 earlier this month, it’s not out of the realm of possibility prices will continue to climb.

Traders are clearly nervous about supplies, particularly with regard to the fresh terrorist attacks in Saudi Arabia in which two terrorists and two police officers were killed.

Norway’s Oil Minister Thorhild Widvey said at an international oil conference in Paris, “When prices hit $50 a barrel, the view was that was unusual. However, prices are still around $50 and may rise higher. It’s not just a price spike but a new price level.”

Gasoline is also up trading at $1.63 right now and heating oil is up too. The United States reported on Wednesday that gasoline reserves were much lower than anticipated dropping over a million barrels more than expected.

The big problem driving prices on fuel in the U.S. right remains refinery troubles. With several refineries going down this year and one still down, gasoline supplies have dwindled even though refineries are running at near capacity. This U.S. hasn’t built a new refinery in decades.

Memorial Day weekend marks the beginning of the summer driving season and price at the pumps may have a dramatic impact on summer travel. In a recent poll conducted by Ipsos Public Affairs and the Associated Press, people are genuinely worried about fuel costs.

51% expect gas prices to cause them hardship and 30% expect it to be serious hardship. 62% also said President Bush isn’t handling the problem effectively. 58% said they’ve reduced their driving and 41% say they’re staying closer to home this year.

This is going to be tough for a country that relies on a service based economy to propel it.

John Stith is a staff writer for Murdok covering technology and business.