Jump to content

These factors are converging to push gas prices higher


HipKat
 Share

Recommended Posts

There is little evidence that gasoline prices, which hit a record $5 a gallon on Saturday, will drop anytime soon.

Rising prices at the pump are a key driver in the highest inflation that Americans have seen in 40 years.

Everyone seems to have a favorite villain for the high cost of filling up.

Some blame President Joe Biden. Others say it’s because Russian President Vladimir Putin recklessly invaded Ukraine. It’s not hard to find people, including Democrats in Congress, who accuse the oil companies of price gouging.

As with many things in life, the answer is complicated.

WHAT IS HAPPENING?

Gasoline prices have been surging since April 2020, when the initial shock of the pandemic drove prices under $1.80 a gallon, according to government figures. They hit $3 in May 2021 and cruised past $4 this March.

On Saturday, the nationwide average for a gallon ticked just above $5, a record, according to auto club AAA, which has tracked prices for years. The average price jumped 18 cents in the previous week, and was $1.92 higher than this time last year.

State averages ranged from $6.43 a gallon in California to $4.52 in Mississippi.

WHY IS THIS HAPPENING?

Several factors are coming together to push gasoline prices higher.

Global oil prices have been rising — unevenly, but sharply overall — since December. The price of international crude has roughly doubled in that time, with the U.S. benchmark rising nearly as much, closing Friday at more than $120 a barrel.

Russia’s invasion of Ukraine and the resulting sanctions by the United States and its allies have contributed to the rise. Russia is a leading oil producer.

The United States is the world’s largest oil producer, but U.S. capacity to turn oil into gasoline is down 900,000 barrels of oil per day since the end of 2019, according to the Energy Department.

Tighter oil and gasoline supplies are hitting as energy consumption rises because of the economic recovery.

Finally, Americans typically drive more starting around Memorial Day, adding to the demand for gasoline.

WHAT CAN BE DONE TO GET MORE OIL?

Analysts say there are no quick fixes; it’s a matter of supply and demand, and supply can’t be ramped up overnight.

If anything, the global oil supply will grow tighter as sanctions against Russia take hold. European Union leaders have vowed to ban most Russian oil by the end of this year.

The U.S. has already imposed a ban even as Biden acknowledged it would affect American consumers. He said the ban was necessary so that the U.S. does not subsidize Russia’s war in Ukraine. “Defending freedom is going to cost,” he declared.

The U.S. could ask Saudi Arabia, Venezuela or Iran to help pick up the slack for the expected drop in Russian oil production, but each of those options carries its own moral and political calculations.

Republicans have called on Biden to help increase domestic oil production — for example, by allowing drilling on more federal lands and offshore, or reversing his decision to revoke a permit for a pipeline that could carry Canadian oil to Gulf Coast refineries.

However, many Democrats and environmentalists would howl if Biden took those steps, which they say would undercut efforts to limit climate change. Even if Biden ignored a big faction of his own party, it would be months or years before those measures could lead to more gasoline at U.S. service stations.

At the end of March, Biden announced another tapping of the nation’s Strategic Petroleum Reserve to bring down gasoline prices. The average price per gallon has jumped 77 cents since then, which analysts say is partly because of a refining squeeze.

WHY IS U.S. REFINING DOWN?

Some refineries that produce gasoline, jet fuel, diesel and other petroleum products shut down during the first year of the pandemic, when demand collapsed. While a few are expected to boost capacity in the next year or so, others are reluctant to invest in new facilities because the transition to electric vehicles will reduce demand for gasoline over the long run.

The owner of one of the nation’s largest refineries, in Houston, announced in April that it will close the facility by the end of next year.

WHO IS HURTING?

Higher energy prices hit lower-income families the hardest. Workers in retail and the fast-food industry can’t work from home — they must commute by car or public transportation.

The National Energy Assistance Directors Association estimates that the 20% of families with the lowest income could be spending 38% of their income on energy including gasoline this year, up from 27% in 2020.

WHEN WILL IT END?

It could be up to motorists themselves — by driving less, they would reduce demand and put downward pressure on prices.

“There has got to be some point where people start cutting back, I just don’t know what the magic point is,” said Patrick De Haan, an analyst for the gas-shopping app GasBuddy. “Is it going to be $5? Is it going to be $6, or $7? That’s the million-dollar question that nobody knows.”

HOW ARE DRIVERS COPING?

On Saturday morning at a BP station in Brooklyn, New York, computer worker Nick Schaffzin blamed Putin for the $5.45 per gallon he was shelling out and said he will make sacrifices to pay the price.

“You just cut back on some other things — vacations, discretionary stuff, stuff that’s nice to have but you don’t need,” he said. “Gas you need.”

At the same station, George Chen said he will have to raise the prices he charges his customers for film production to cover the gas he burns driving around New York City. He acknowledged that others aren’t so fortunate.

“It’s going to be painful for people who don’t get pay increases right away,” he said. ”I can only imagine the families who can’t afford it.”

  • Poop 1

“There he goes. One of God's own prototypes.

A high-powered mutant of some kind, never even considered for mass production.

Too weird to live, and too rare to die.”

 

Twitter: @HKTheResistance

 

HipKat, on *** other h***, is genuine, unapoli***tically nasty, and w**** his hea** on his ******. jc856

I’ll just forward them to Bridgett. comssvet11

Seek help. soflabillsfan

Link to comment
Share on other sites

1 hour ago, SpikedLemonade said:

I DRIVE ELECTRIC

Hope you don’t get caught in one of those snow storms that keeps you stuck on the highway for 24 hours

  • Like 1

“There he goes. One of God's own prototypes.

A high-powered mutant of some kind, never even considered for mass production.

Too weird to live, and too rare to die.”

 

Twitter: @HKTheResistance

 

HipKat, on *** other h***, is genuine, unapoli***tically nasty, and w**** his hea** on his ******. jc856

I’ll just forward them to Bridgett. comssvet11

Seek help. soflabillsfan

Link to comment
Share on other sites

40 minutes ago, HipKat said:

Hope you don’t get caught in one of those snow storms that keeps you stuck on the highway for 24 hours

I would have to be a retard to be out on the highway when a snow storm is in the forecast.

There is a reason they call it a SmartCar.

Most of the posters on this message board would not qualify to own one.

Do Your Part to Improve The Range -- Please put the TRIO OF TRUMP FLUFFERSTM  on IGNORE

Link to comment
Share on other sites

2 hours ago, HipKat said:

There is little evidence that gasoline prices, which hit a record $5 a gallon on Saturday, will drop anytime soon.

Rising prices at the pump are a key driver in the highest inflation that Americans have seen in 40 years.

Everyone seems to have a favorite villain for the high cost of filling up.

Some blame President Joe Biden. Others say it’s because Russian President Vladimir Putin recklessly invaded Ukraine. It’s not hard to find people, including Democrats in Congress, who accuse the oil companies of price gouging.

As with many things in life, the answer is complicated.

WHAT IS HAPPENING?

Gasoline prices have been surging since April 2020, when the initial shock of the pandemic drove prices under $1.80 a gallon, according to government figures. They hit $3 in May 2021 and cruised past $4 this March.

On Saturday, the nationwide average for a gallon ticked just above $5, a record, according to auto club AAA, which has tracked prices for years. The average price jumped 18 cents in the previous week, and was $1.92 higher than this time last year.

State averages ranged from $6.43 a gallon in California to $4.52 in Mississippi.

WHY IS THIS HAPPENING?

Several factors are coming together to push gasoline prices higher.

Global oil prices have been rising — unevenly, but sharply overall — since December. The price of international crude has roughly doubled in that time, with the U.S. benchmark rising nearly as much, closing Friday at more than $120 a barrel.

Russia’s invasion of Ukraine and the resulting sanctions by the United States and its allies have contributed to the rise. Russia is a leading oil producer.

The United States is the world’s largest oil producer, but U.S. capacity to turn oil into gasoline is down 900,000 barrels of oil per day since the end of 2019, according to the Energy Department.

Tighter oil and gasoline supplies are hitting as energy consumption rises because of the economic recovery.

Finally, Americans typically drive more starting around Memorial Day, adding to the demand for gasoline.

WHAT CAN BE DONE TO GET MORE OIL?

Analysts say there are no quick fixes; it’s a matter of supply and demand, and supply can’t be ramped up overnight.

If anything, the global oil supply will grow tighter as sanctions against Russia take hold. European Union leaders have vowed to ban most Russian oil by the end of this year.

The U.S. has already imposed a ban even as Biden acknowledged it would affect American consumers. He said the ban was necessary so that the U.S. does not subsidize Russia’s war in Ukraine. “Defending freedom is going to cost,” he declared.

The U.S. could ask Saudi Arabia, Venezuela or Iran to help pick up the slack for the expected drop in Russian oil production, but each of those options carries its own moral and political calculations.

Republicans have called on Biden to help increase domestic oil production — for example, by allowing drilling on more federal lands and offshore, or reversing his decision to revoke a permit for a pipeline that could carry Canadian oil to Gulf Coast refineries.

However, many Democrats and environmentalists would howl if Biden took those steps, which they say would undercut efforts to limit climate change. Even if Biden ignored a big faction of his own party, it would be months or years before those measures could lead to more gasoline at U.S. service stations.

At the end of March, Biden announced another tapping of the nation’s Strategic Petroleum Reserve to bring down gasoline prices. The average price per gallon has jumped 77 cents since then, which analysts say is partly because of a refining squeeze.

WHY IS U.S. REFINING DOWN?

Some refineries that produce gasoline, jet fuel, diesel and other petroleum products shut down during the first year of the pandemic, when demand collapsed. While a few are expected to boost capacity in the next year or so, others are reluctant to invest in new facilities because the transition to electric vehicles will reduce demand for gasoline over the long run.

The owner of one of the nation’s largest refineries, in Houston, announced in April that it will close the facility by the end of next year.

WHO IS HURTING?

Higher energy prices hit lower-income families the hardest. Workers in retail and the fast-food industry can’t work from home — they must commute by car or public transportation.

The National Energy Assistance Directors Association estimates that the 20% of families with the lowest income could be spending 38% of their income on energy including gasoline this year, up from 27% in 2020.

WHEN WILL IT END?

It could be up to motorists themselves — by driving less, they would reduce demand and put downward pressure on prices.

“There has got to be some point where people start cutting back, I just don’t know what the magic point is,” said Patrick De Haan, an analyst for the gas-shopping app GasBuddy. “Is it going to be $5? Is it going to be $6, or $7? That’s the million-dollar question that nobody knows.”

HOW ARE DRIVERS COPING?

On Saturday morning at a BP station in Brooklyn, New York, computer worker Nick Schaffzin blamed Putin for the $5.45 per gallon he was shelling out and said he will make sacrifices to pay the price.

“You just cut back on some other things — vacations, discretionary stuff, stuff that’s nice to have but you don’t need,” he said. “Gas you need.”

At the same station, George Chen said he will have to raise the prices he charges his customers for film production to cover the gas he burns driving around New York City. He acknowledged that others aren’t so fortunate.

“It’s going to be painful for people who don’t get pay increases right away,” he said. ”I can only imagine the families who can’t afford it.”

I have a feeling the midterms are going to show that people blame Biden and this administration. Remember the midterms during Obama's first term when the Republicans kicked ass. The 2022 midterms will be worse than that for the Dems. I can't wait to see the country flip red.

  • Like 1
Link to comment
Share on other sites

3 hours ago, Greg said:

I have a feeling the midterms are going to show that people blame Biden and this administration. Remember the midterms during Obama's first term when the Republicans kicked ass. The 2022 midterms will be worse than that for the Dems. I can't wait to see the country flip red.

I also remember that when the Republicans won those midterms when Obama was president that after they took control, they didn’t do a fucking thing which is pretty typical of Republicans as it is. I don’t expect that they’ll do anything should they do well in the midterms this year either. I mean how can you expect them to do anything when they cannot lay down any type of platform?

it will be a shallow victory in name only that has no positive effect for America

“There he goes. One of God's own prototypes.

A high-powered mutant of some kind, never even considered for mass production.

Too weird to live, and too rare to die.”

 

Twitter: @HKTheResistance

 

HipKat, on *** other h***, is genuine, unapoli***tically nasty, and w**** his hea** on his ******. jc856

I’ll just forward them to Bridgett. comssvet11

Seek help. soflabillsfan

Link to comment
Share on other sites

19 minutes ago, HipKat said:

I also remember that when the Republicans won those midterms when Obama was president that after they took control, they didn’t do a fucking thing which is pretty typical of Republicans as it is. I don’t expect that they’ll do anything should they do well in the midterms this year either. I mean how can you expect them to do anything when they cannot lay down any type of platform?

it will be a shallow victory in name only that has no positive effect for America

The one thing they will do is handcuff Biden for the last two years of his only term. Thank God for that because Biden = shit.

  • Like 1
Link to comment
Share on other sites

26 minutes ago, Greg said:

The one thing they will do is handcuff Biden for the last two years of his only term. Thank God for that because Biden = shit.

No they won’t. He will abuse the executive order process just like Obama did and just like Trump did.

“There he goes. One of God's own prototypes.

A high-powered mutant of some kind, never even considered for mass production.

Too weird to live, and too rare to die.”

 

Twitter: @HKTheResistance

 

HipKat, on *** other h***, is genuine, unapoli***tically nasty, and w**** his hea** on his ******. jc856

I’ll just forward them to Bridgett. comssvet11

Seek help. soflabillsfan

Link to comment
Share on other sites

Paj6bKPVzfAw.jpeg

  • Laugh 1
  • Like 1

Sack "The Buffalo Range's TRUSTED News Source!"

“When a well-packaged web of lies has been sold gradually to the masses over generations, the truth will seem utterly preposterous and its speaker a raving lunatic.” ~ Dresden James

Parler @NYexile

 

 

 

Link to comment
Share on other sites

Exxon mobile made $.5 billion in profit for Q1 2022. Same time last year they made 2.1 billion. I wonder how that happened?

BuT ByE-dUn!

“There he goes. One of God's own prototypes.

A high-powered mutant of some kind, never even considered for mass production.

Too weird to live, and too rare to die.”

 

Twitter: @HKTheResistance

 

HipKat, on *** other h***, is genuine, unapoli***tically nasty, and w**** his hea** on his ******. jc856

I’ll just forward them to Bridgett. comssvet11

Seek help. soflabillsfan

Link to comment
Share on other sites

6 minutes ago, HipKat said:

Exxon mobile made $.5 billion in profit for Q1 2022. Same time last year they made 2.1 billion. I wonder how that happened?

BuT ByE-dUn!

Are they gouging? Is that what you are inferring?

Link to comment
Share on other sites

You know who accurately predicted what Biden's proposed policy to stop fossil fuel drilling ('ENDED') would do to the economy?

Yes the AQUARIAN  OUR GREATEST LIVING PRESIDENT!!

DONALD TRUMP IS PRESCIENTLY RIGHT ABOUT EVERYTHING.   THE ONLY QUESTION IS HOW MUCH TIME WILL PASS BEFORE HE IS VINDICATED!!

  • Like 1
Link to comment
Share on other sites

7 hours ago, FanBack said:

The Biden Administration.   He promised no more drilling in federal lands and no more offshore drilling; he delivered in principal.

Oil production is doing fine in the USA.  Averaging over 11,000,000 Barrels a day, similar to the 4 year avg of the Trump Administration.

https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=MCRFPUS2&f=M

So what's different this time?  

We don't have a shortage of oil in the USA, we have a global market that is willing to pay a higher price per BBL.  

  • Like 1
Link to comment
Share on other sites

1 hour ago, foster said:

Oil production is doing fine in the USA.  Averaging over 11,000,000 Barrels a day, similar to the 4 year avg of the Trump Administration.

https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=MCRFPUS2&f=M

So what's different this time?  

We don't have a shortage of oil in the USA, we have a global market that is willing to pay a higher price per BBL.  

Thank you for posting this.

Link to comment
Share on other sites

1 hour ago, foster said:

Oil production is doing fine in the USA.  Averaging over 11,000,000 Barrels a day, similar to the 4 year avg of the Trump Administration.

https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=MCRFPUS2&f=M

So what's different this time?  

We don't have a shortage of oil in the USA, we have a global market that is willing to pay a higher price per BBL.  

Take out the Covid years. 

  • Like 1
Link to comment
Share on other sites

37 minutes ago, TonyasTaters said:

Thank you for posting this.

Neither of you know what you're talking about.   We have the capability to produce more oil here and buy less from overseas.   The Biden administration shut down the pipeline and suspended drilling leases while they rewrote the regulations. 

Think of the Ukrainians you killed by voting for Biden.

 

 

  • Like 1
Link to comment
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

 Share

×
×
  • Create New...