PEORIA, Ill. (WMBD) — Gasoline prices are on a nine-week upward swing, and there are few signs of relief as we near a summer travel season that may look a lot closer to normal than 2020.
According to GasBuddy’s weekly survey of 150,000 stations, the price of a gallon was up another five cents over the past week. The average price has jumped 31 cents in just a month.
A week ago, the surge was being blamed on the production slowdown caused by freezing temperatures in the south. This week, GasBuddy Petroleum Analysis Head Patrick De Haan said OPEC surprised oil markets by extending oil production cuts for another month, ignoring the resurgence in global demand as economies recover from COVID-19.
He said those markets responded by pushing oil prices up 12%, meaning motorists should prepare for further gas price increases in the weeks and potentially months ahead, with a $3 per gallon national average potentially less than a month away.
“At the start of this year, it was somewhat outlandish to predict a $3 per gallon national average for the summer driving season, but thanks to the speed of recovery from the pandemic pushing demand higher and OPEC’s reluctance to raise oil production, we’re on the cusp of making that a reality,” De Haan said in a blog post.
AAA says the OPEC decision led to the highest per-barrel price in two years.
“The last time we saw the national average flirt with $3 was nearly three years ago in May 2018,” Spokesperson Jeanette McGee said in a AAA gas price update.
Her agency says the national average is almost 40 cents more expensive than a year ago, just before national lockdowns began.
Gas Buddy says it’s common to see a spring surge in prices, but that the increase may be more pronounced this year as loosening regulations and high vaccine rates allow people to again move more freely after more than a year of limitations.
“It’s extremely frustrating as a consumer to feel helpless as prices soar and as millions remain unemployed, so the only advice I can offer consumers is [to] prepare for further increases, and to mitigate rising prices, shop around for the low prices every time you need to refuel,” said De Haan. “I’m hopeful OPEC will see the error in their ways at next month’s meeting, but with demand exceeding supply, the longer the imbalance continues, the longer it will take for any rise in oil production to offset it.”
