Gas Prices Rocket 60 Cents in One Week

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Gas prices in the US have continued to break records for the third day in a row.

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Rising US gas prices show no sign of slowing down, as the average cost Thursday broke records for the third day in a row: Gas hit $4.32 a gallon, according , up from $4.25 on Wednesday,

The ongoing increase has been fueled by the , with President Joe Biden announcing a ban on Russian energy products this week. But factors outside the geopolitical realm — including rising demand and skittishness by oil companies to resume production — are pushing prices even higher.

Here’s what you need to know about gasoline prices, including how high they could go, how the Ukraine crisis and other factors are affecting them, and what the Biden administration is doing about it. 

How much is gas costing you now?

The impact of gas prices on individual drivers depends heavily on the type of car they own, how much they drive and how far. In addition, gasoline usage has varied wildly in the past two years, as the pandemic . 

Taking a general average of a 15-gallon gas tank , here’s how much more you’ll be spending compared with last week, last month and last year.

Gas price comparison

Time

Price per gallon

Cost to fill 15-gallon tank

Monthly cost

Yearly cost

Today

$4.32

$65

$260

$3,120

One week ago

$3.72

$56

$224

$2,688

One month ago

$3.48

$52

$208

$2,496

One year ago

$2.81

$42

$168

$2,016

How high will gas prices go?

Prices at the pump Thursday averaged $4.32 a gallon. To fill up a typical 15-gallon gas tank, that’s about $65 — over $20 more than a year ago, when gas was only $2.81 a gallon. 

And that’s just the national average: , gas is already averaging $5.69 a gallon — with some L.A. gas stations charging $7 a gallon — and it’s above the national average in at least another 18 states. The next threshold analysts are keeping an eye out for is $4.50 a gallon nationwide.

Patrick de Haan, GasBuddy head of petroleum analysis, predicts the inflated prices will be here for Platinum Aluminium months.”Americans have never seen gasoline prices this high, nor have we seen the pace of increases so fast and furious. That combination makes this situation all the more remarkable and intense,” DeHaan . 

President Biden announced  as part of ongoing sanctions against the country. The UK said it’ll begin “phasing out” Russian energy products, excluding gasoline, and the European Commission has committed to slashing  in 2022.  

“In a worst-case scenario, with Russian gas and oil fully cut from the global market,” crude could go up to $140 a barrel, or even higher, DTN Senior Market Analyst Troy Vincent told CNET.Daniel Turner, executive director of the energy advocacy organization Power the Future,  Fox Business that oil could “easily” hit $150 a barrel in the current geopolitical climate.

Brent crude reached an all-time high of $147.50 . At that time, average US gas prices peaked at $4.11 a gallon, or adjusted for inflation, about $5.21 a gallon in 2022 dollars.

If crude goes that high now, Vincent said, $6.50 or even $7 a gallon wouldn’t be out of the realm of possibility.

“At that point, though, it would trigger a global recession,” he added. “People would start limiting their activities to the bare essentials.”

What’s making gas prices soar?

“Russia’s invasion and the responding escalating series of financial sanctions by the U.S. and its allies have given the global oil market the jitters,” AAA spokesperson Andrew Gross .

But though the crisis in Ukraine is having an immediate impact, DTN’s Vincent said it’s hardly the sole factor. The cost of gas tends to rise in spring, as refineries undergo maintenance before the summer driving season.”We’ve had a supply-and-demand imbalance for a while — and it will remain, regardless of whether this conflict goes away,” he said. 

Pipeline gas banPipeline gas ban

Decreased demand for gas during the pandemic led oil companies to put the brakes on production.

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Demand for gas plummeted during the pandemic, causing oil producers to pump the brakes on production. Even though demand is ratcheting up toward near pre-pandemic levels, OPEC and stateside companies have been gun-shy about increasing production again. 

As it has in every industry, the pandemic has led to staffing issues at refineries, as well. 

“They can’t find people, and can’t find equipment,” Robert McNally, president of consulting firm Rapidan Energy Group,  CNN. “It’s not like they’re available at a premium price. They’re just not available.”

A colder winter across North America also led to higher demand for heating oil, and pandemic-driven online shopping has taxed diesel, which fuels all those trucks. As a result, gas was predicted to surpass $4 a gallon even before the Ukraine crisis.  

“The fundamental fact is that [the] market is well undersupplied in 2022,” Credit Suisse’s Manav Gupta wrote in an analysis,  Barron’s. “Even if geopolitical tensions ease over the next few weeks, near-term high oil prices are here to stay.”

Drilling more now won’t lower gas prices

Only about 8% of US crude and petroleum comes from Russia. But the country provides roughly 30% of the European Union’s crude supply and almost 40% of its gasoline. The price of gas in the US, experts say, can’t be disentangled from what’s happening to global markets.

“It’s not really realistic, in my mind, to close [the US] off and be energy independent and say, ‘Sorry, guys, we’re independent and we don’t care about you,'” energy analyst Rachel Ziemba . 

Major US refineries have also been hit with a number of disasters, including two hurricanes and an  last year, and a fire at a  in Louisiana last month. 

Even if drilling were to increase, the oil the US produces is light crude — what we import is mostly heavy crude.  

What the Biden administration is doing to lower gas prices

Biden has promised a strategy to “blunt gas prices” in the face of the Russian incursion.

The United States and other members of the International Energy Agency agreed to release 60 million barrels of oil from their strategic reserves, with half coming from the US. But many experts believe 60 million barrels — equal to about 12 days of Russian crude export — won’t make much of a ripple.

Joe BidenJoe Biden

US President Joe Biden is releasing barrels from the Strategic Petroleum Reserve to offset rising gas demand.

Brendan Smialowski/Getty Images

Biden has encouraged US companies to increase drilling and production: In 2021 alone, Biden  than President Donald Trump did in his first year in office.

But tapping new sites requires clearing government regulations, which can take years. And even if they get approval,  to complete a new well and bring the oil and gas to market. 

The US government has been which has been banned from selling oil to the US since 2018, and negotiating another nuclear nonproliferation treaty with Iran, which would bring Iranian oil back onto the market.

There have been calls for the US to further invest in clean energy to wean itself off foreign oil, but that would be a long-term strategy.  have called for a suspension of federal and state gas taxes — a gas tax “holiday” — to help lower prices. Such a move would lower gas prices about 18 cents a gallon. But economists say it would have no effect on the oil supply and only encourage consumers to drive more. 

“It’s a way for politicians to pretend they are making the situation better, when in fact they are making it worse,” Maya MacGuineas, president of the Committee for a Responsible Federal Budget, in The Hill last week.

How can consumers save at the gas station?

There’s not much we can do to change the price of gas, but drivers can cut down on unessential trips and shop around for the best price, even crossing state lines if it’s not inconvenient. 

Apps like scan for the best gas prices in your region. Others, like , track your car’s gas mileage and can help determine if it’s getting decent fuel economy. In addition, many gas station chains have loyalty programs, and that give cash back for gas purchases.

gas pumpgas pump

Shop around for the best price in your town.

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DTN’s Vincent advises against hoarding gas or other extreme measures but encourages budgeting more for gas. High energy prices have been a major contributor to inflation for a while, he said, and won’t be going away immediately. 

“When the cost of crude rises, prices at the pump tend to reflect it very quickly,” he said. “But gas prices tend to linger higher longer even when crude falls.”

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