A perfect storm has converged to raise the price of gasoline to levels not seen since 2015. In both Missouri and Kansas, drivers are paying an average of $2.47 per gallon. The national average is $2.76 according to a nationwide survey.
Several factors have come together for the increase.
OPEC is continuing to squeeze supplies while world demand is up. But the primary cause may be a booming American economy. Unemployment is at historic lows in much of the nation under the Trump economy with factories booming and travel, spurred by high confidence in the future, continues to outpace expectations.
“Gas price increases gripped 49 of the nation’s 50 states again last week as oil prices continued their upward move to new multi-year highs. In addition, government data highlighted a new record for gasoline demand was breached last week, and we’re not even into the summer driving season yet. The road ahead at the pump looks quite ominous if that demand number proves common in the coming weeks,” said Patrick DeHaan, head of petroleum analysis for gas price monitoring company.
The increase in cost has caught the eye of the president.
“With President Trump’s tweet last week targeting the price of oil, there may be additional scrutiny on oil prices in the coming weeks that bears monitoring. OPEC has been remarkably successful in better aligning supply to demand, draining the crude oil glut, and pushing oil prices to their highest since 2014. With refinery maintenance and the change to summer gasoline largely complete, oil prices remain one of the largest active drivers of gas prices now and, likely, in the weeks ahead. All signs point to some additional upward movement before prices peak and perhaps drop slightly around Memorial Day into the month of June — all certainly very contingent and subject to any changes from OPEC,” he said.
But it’s not just OPEC affecting the price of oil. Under president Trump and an oil-friendly domestic production policy, the United States has become an oil exporter and our oil is pretty sweet. Sweet crude, as it’s known, is popular around the world for its quality and stability of supply––driving costs up. Belying the headlines pushed by the national media, the United States is still viewed overwhelmingly as the most stable country in the world meaning oil importing countries can rely on a stable supply under the Trump administration.
Gone are the days when OPEC could employ an oil embargo to bring the nation to its knees. But they are still a major player.
The price for a barrel of West Texas Intermediate crude oil last week surged to nearly $70, the highest level since oil was in the midst of collapsing in December 2014 as OPEC increased supply. .
President Trump, concerned how the rise is affecting the average American weighed in on Twitter last week, calling on OPEC to raise production and bring prices back down. U.S. oil inventories now stand 105 million barrels lower than a year ago, or nearly 20 percent. Refinery utilization also slipped, leading to lower production of refined fuels.
Looking state-by-state, the largest weekly changes in average gas prices were seen in: Michigan (+11 cents), Rhode Island (+11 cents), Ohio (+10 cents), Connecticut (+9 cents), New Jersey (+9 cents), Massachusetts (+8 cents), New Hampshire (+8 cents), New York (+7 cents), Maine (+7 cents) and Utah (+7 cents).
States with the lowest average gasoline prices: Missouri ($2.44), Oklahoma ($2.44), Arkansas ($2.47), Kansas ($2.49), Mississippi ($2.50), Louisiana ($2.50), Texas ($2.51), South Carolina ($2.51), Wyoming ($2.52) and Alabama ($2.53).
States with the highest average gasoline prices: California ($3.56), Hawaii ($3.54), Washington ($3.22), Alaska ($3.20), Nevada ($3.17), Oregon ($3.12), Utah ($3.06), Idaho ($3.00), Pennsylvania ($2.97) and Connecticut ($2.88).
Gas prices are likely to continue rising in Missouri and Kansas over the next week as retail prices catch up to last week’s rise in the price of oil.
–Metro Voice and wire services