Welcome back to Gas Price Watch: Our daily post about just how painful your visit to the pump will be today and into the near future.
We had a plateau in prices yesterday, and as of this morning, the average price dipped a whole cent due, in part, to the price of a barrel of oil dropping below $100. Don’t start breaking out the first-gen Escalades just yet, however. Gas prices remain fairly high, and there is reason to worry that warmer months will bring even pricer fuel.
Every spring, oil refineries switch from producing from producing heavy crude to light sweet crude. That switch over brings higher prices as the supply chain for refined gasoline is temporarily gummed up. AAA spokesperson Robert Sinclair Jr. spoke to Yahoo Finance about what Americans can expect in the coming months:
A short-term peak. I think we may have peaked so far for the current hikes in that we’re at $4.32 per gallon and we’ve been there for a couple of days. But there are things on the horizon that will lead to gasoline prices going higher, namely the switch over to summer blends of gasoline, which starts tomorrow on the West Coast and has to be completed by mid-April on the East Coast. Those blends are more difficult to refine, more complicated to distribute.
So that leads to the price going up. And as the weather gets better, people want to get out and get rid of the COVID doldrums and take a trip somewhere. And 85% to 95% of summer holiday trips and summer vacation trips are taken by motor vehicles. So demand goes up. And with it, price. So we might see a leveling off right now. But there are factors in the near future that will make prices go higher.
Several states are toying with the idea of temporarily suspending the state-level gas tax to give Americans a bit of a break at the pump, according to the Hill. Maryland, Georgia, Florida and California all have bills working their way through the legislative process while officials in Alaska, Colorado, Idaho, Illinois, Maine, Minnesota, Missouri, New Jersey, New York, Ohio, Pennsylvania and Rhode Island have floated the possibility.
The Russian invasion of Ukraine is the main cause of this price spike, and the possibility of further sanctions against Russian fuel could cause costs to rise even higher. With no end in sight in that conflict, another spike in gas prices is a very real possibility. From CNET:
The US government’s Energy Information Administration now predicts Brent oil will average over $100 a barrel for the remainder of 2022. But, the agency added, its forecasts could change greatly if additional European countries sanction Russian oil.
Bjørnar Tonhaugen, head of oil markets for Rystad Energy, says that if enough European countries join the embargo, oil could hit $240 a barrel by the summer.
“It would create a 4.3 million barrels-per-day hole in the market that simply cannot be quickly replaced by other sources of supply,” Tonhaugen noted.Even at $200 a barrel, experts see gasoline prices averaging $5.84 per gallon, according to NPR. Oil at $240 would trigger a global recession later this year, Tonhaugen said. At that point demand would be forced down, he added, and the price would fall steeply.
“The higher prices go, the larger the chances of the global economy entering a recession already in the fourth quarter of 2022,” he said.
Well, if there is a silver lining in all this, if things really do escalate in Europe, we’ll have a lot more to worry about than just gas prices.
Here is where you can find the highest average gas prices in the country in order of highest price for a gallon regular:
- California - $5.75 Regular | $5.94 Mid | $6.07 Premium | $6.29 Diesel
- Nevada - $4.96 Regular | $5.17 Mid | $5.37 Premium | $5.21 Diesel
- Hawaii - $4.97 Regular | $5.14 Mid | $5.41 Premium | $5.23 Diesel
- Washington - $4.74 Regular | $4.95 Mid | $5.13 Premium | $5.39 Diesel
- Oregon - $4.73 Regular | $4.91 Mid | $5.12 Premium | $5.37 Diesel
Here is the lowest average price of gasoline in the country in order of lowest price per gallon of regular:
- Kansas - $3.81 Regular | $4.08 Mid | $4.33 Premium | $4.65 Diesel
- Missouri - $3.83 Regular | $4.10 Mid | $4.38 Premium | $4.74 Diesel
- Oklahoma - $3.84 Regular | $4.13 Mid | $4.36 Premium | $4.75 Diesel
- Arkansas - $3.88 Regular | $4.19 Mid | $4.50 Premium | $4.82 Diesel
- Nebraska - $3.89 Regular | $4.01 Mid | $4.39 Premium | $4.74 Diesel
So it’s a mixed bag of gas news today. Remember to keep those tires inflated and drive a little slower than maybe you’re use to in order to save on fuel.