NEW YORK — As she watches the price of gasoline spike higher, Sarah Wilmes is approaching the breaking point.

The accountant and mother of two so far hasn't cut back on back-to-school spending for her two elementary school-age children, although gas prices have surged to a nationwide average of $2.55 a gallon. But, the resident of Kearney, Mo., said on a recent trip to a shopping mall, it's getting hard to ignore the ever-increasing cost of filling up.

"It's to the point now where a couple of weeks can affect the budget you were used to six months ago or a year ago," Wilmes said. "You wonder if there is an end in sight."

While middle-income consumers like Wilmes have surprised economists in their willingness to spend despite gasoline's upward trek, they're increasingly feeling the pain of higher prices. So retailers are wondering when — not if — these shoppers will finally pull back.

Retailers such as Wal-Mart Stores Inc. and Family Dollar Stores Inc. that cater to lower-income shoppers have already seen sales slow over the past year. Now mid-tier retailers like J.C. Penney Co. Inc. and Gap Inc. are anxious as they enter the crucial fall and holiday selling seasons.

Despite generally solid early back-to-school results, merchants including Wal-Mart and Gap issued muted forecasts along with second-quarter earnings reports this past week. The companies cited concerns about oil's impact on the economy; some said higher energy costs are making it harder to run their businesses.

"There is definitely caution out there," said Ken Perkins, president of Retail Metrics LLC, a research firm in Swampscott, Mass., noting that third-quarter earnings growth for the 143 retailers he tracks has been pared to 13.1 percent from 15.2 percent since Monday.

"We are seeing consumers on the low end becoming squeezed by the higher energy more so than we have seen all year," Perkins said. "If the current situation persists, we will likely see more consumers feel the pinch as higher energy prices squeeze middle-income shoppers, hurting mid-tier retailers."

Perkins noted that Penney, Gap, Kohl's Corp., and Limited Brands Inc., all of whom serve the middle-income customer, are among the most vulnerable. Upscales stores like Nordstrom Inc. and Neiman Marcus Group Inc. haven't been hurt because their well-heeled consumers are more insulated from the higher price of gas.

Penney expressed concern about the impact of expensive gas this past week although it reported better-than-expected second-quarter profits and raised its earnings outlook.

"I'd rather be with the moderate consumer than the budget consumer during this time," said Myron Ullman, chairman and CEO of Penney, in a conference call with investors Tuesday. But, he added, "there's no question that the increase in fuel prices is on the radar screen of our consumer."

Wal-Mart announced its smallest quarterly profit growth in four years on Tuesday and lowered its earnings forecast for the year. The world's largest retailer said its utility expenses rose by $100 million in the quarter and its fuel costs were up $30 million.

So far, chains like teen retailer American Eagle Outfitters Inc. and Abercrombie & Fitch Co. have reported strong denim sales. But with the latest styles, which sell for more than $100 a pair, will consumers be willing to splurge as more of their discretionary dollars go to gasoline?

Cherie Olivero, a resident of Kendall, Fla., who is starting college at the end of the month, bought a pair of jeans at Guess, where she works, but noted that even with her employee discount, "jeans are really expensive." She doesn't have a car but she's paying more as she gives her brother money for gas.