U.S. gas prices hit 8-month high.
Gas Prices Soar to Eight-Month High in the U.S.
Gas prices have skyrocketed to an eight-month high across the United States, with analysts predicting further increases.
According to AAA, the average price for a gallon of regular gas reached $3.73 on Friday, while diesel hit $3.97. Last summer, AAA recorded the highest prices ever, with regular gas reaching $5.01 per gallon and diesel hitting $5.81. On Thursday, gas prices reached their highest point since November 22.
Several states, including Iowa, Florida, and Indiana, have seen prices surge by over 20 cents in just one week. NBC News reports that 16 states have experienced jumps of at least 15 cents. The price surge began on Thursday and continued into Friday.
BREAKING: The average price of gasoline in the US has risen to its highest level of 2023 at $3.687/gal.
— Patrick De Haan ⛽️📊 (@GasBuddyGuy) July 27, 2023
Analysts attribute the price surge to decreased oil production and refinery outages. Saudi Arabia recently announced a reduction in oil production by one million barrels per day for July and August to stabilize the oil market. As a result, the price of a barrel of oil has surpassed $80.
Patrick De Haan, a petroleum analyst at Gas Buddy, revealed that some refineries in Texas and Louisiana have faced issues during the summer. He explained, ”There’s no magic formula to determine the exact impact on gas prices, since factors such as refineries make that relationship more murky. Refining capacity has been the elephant in the room, causing gas prices to have less of a direct relationship with oil since Covid shut down a significant amount of refinery capacity.”
De Haan predicts that gas prices may approach an average of $4 per gallon. He tweeted, “On our current trajectory, it seems the national average could rise to $3.85/gal, and we could even get close to $4/gal on the first potential of a storm aiming for the Gulf.”
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When President Joe Biden took office, the national average price of gasoline was $2.38 per gallon, according to the Energy Information Administration. By the start of the Russian invasion of Ukraine, the price had increased to $3.53 per gallon.
The Biden administration has consistently attributed rising gas prices to Russia’s invasion of Ukraine. However, the president has faced criticism for his energy policies, including the cancellation of the Keystone Pipeline and restrictions on oil drilling on federal lands.
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