Soon as President Joe Biden announced a ban on Russian oil import, US gas prices rose to their highest rates. A gallon of gas now sells at an average of $4.17, according to the American Automobile Association of America (AAA).
US Gas Prices On An Upward Trajectory, And It’s Not Coming Down Soon
US gas prices are currently on an upward trajectory ever since demand outweighed supply last year. As the pandemic started to wind down, many businesses began resuming their production activities.
However, oil-producing countries weren’t so eager to increase oil output. They said that their economies suffered in 2020 and 2021 due to COVID-19 cratering demand.
They won’t increase production again unless they’re sure disruptions won’t happen again. With demand outstripping supply, prices began going up.
Then, Russia happened. The world’s second-largest oil exporter decided to invade its neighbor Ukraine. The already-precarious supply of oil began to dwindle further as countries began shunning Russian oil.
OPEC has yet to act on the developments, but it’s already saying that they cannot offset Russia’s production.
US Gas Prices Now At Record High of $4.17 Per Gallon
Following Biden’s decision to further sanction Russia by banning its oil and gas imports, US gas prices shot up again. According to the AAA, the new $4.17 average per gallon is up by 10 cents from the $4.07 set last Monday. Last week, US gas prices sold at an average of $3.61 per gallon.
In addition, the new price of $4.17 erased the previous high of $4.11 set in 2008. When adjusted for inflation, however, the 2008 rate remained more expensive, as it will come down to $5.25 using today’s rates.
Either way, US gas prices are now very expensive. Even diesel prices are nearing the old record of $4.84. Current average diesel prices are now at $4.25.
US Gas Prices Will Keep Rising
Tom Kloza, the chief global analyst for the Oil Price Information Service, said that US gas prices will keep on rising in the near future.
Russia is the second-largest oil producer in the world. Until the conflict between Russia and Ukraine ends in a peaceful solution, the impact of Russian oil will remain.
Meanwhile, Gas Buddy projects that US gas prices will likely average $4.25 by May and stay over $4 this year. Patrick De Haan, head of petroleum analysis at GasBuddy, warns Americans to brace themselves.
“Americans have never seen gasoline prices this high, nor have we seen the pace of increases so fast and furious,” he said. Ongoing sanctions against Russia are curbing the flow of oil.
This is putting further pressure on oil production. It’s just not gas, but also diesel, jet fuel, and others. What about the chances that US gas prices reach 5 per gallon? De Haan says that while remote at present, chances remain.
California Reporting Gas Prices of $7 Per Gallon
Due to local tax laws, gas prices vary from state to state. Stations in Los Angeles and San Francisco sell regular gas for more than $6 per gallon, with some reaching nearly $7.
Meanwhile, only 28 states have average prices over $4. Only South Dakota, Kansas, Missouri, Oklahoma, and Arkansas averaged less than $3.80. In fact, the cheapest state to get gas in is Oklahoma at an average of $3.71.
Watch the NewsNation video reporting that gas prices hit a record high of $4.17/gallon:
What do you think of the continued rise in gas prices? How soon can Americans enjoy lower gas prices? Or, should they expect high gas prices from this moment onward?
Let us know what you think. Share your comments below.