About Gas Prices

Gas prices are up...and likely to continue to increase over the next few months.

The national average for regular gas jumped to $3.51 a gallon last week, according to AAA. That's still a lot less than the record $5.02 a gallon last June; but gas prices have increased by 12 cents in the past week and 41 cents in the past month.

All told, the national average has climbed by more than 9% since the beginning of the year – the biggest increase to start a year since 2009.

So far, it's not demand but supply that has caused most of the increase. The extreme weather in much of the United States recently caused a series of outages at the refineries that produce the gasoline, jet fuel and diesel.

US oil prices (WTI) were down to $71.02/bbl in early December, but on Wednesday (Feb. 1st), WTI crude was $78.92/bbl and Brent crude was $85.21.

OPEC says it will keep its production about the same this year, and China's economy, which had been suffering from shutdowns related to COVID, is expected to return to pre-pandemic growth.

That means higher crude prices and that means higher prices for gas and diesel, although most experts agree that we won't likely top the $100/bbl mark again anytime soon.

In other petroleum news, the Biden administration appears likely now to approve a scaled-down oil project in northwestern Alaska.

While the US has stopped buying oil from Russia and the European Union has imposed price controls, the Russians are still shipping oil elsewhere around the world--in record quantities; and despite the political outcries of many about the decision to shut down construction of the Keystone XL project, Canada's oil exports to the US are at a record high.