Buffalo, NY (WBEN) If you've been filling up lately, you know the pain at the pump.
Gas prices went up 8 cents a gallon in the last week, with the average price for a gallon now up to $3.27.
Experts tell WBEN there are several factors behind the hike.
Crude oil prices have shot up says Patrick DeHaan of Gas Buddy. "Last week saw oil prices advance to their highest in seven years, with a barrel of West Texas Intermediate crude oil surpassing the critical $80 per barrel level. The nation's gas prices were also pushed to their highest since 2014, all on OPEC's decision not to raise production more than it already agreed to in July," says DeHaan.
"The OPEC decision caused an immediate reaction in oil prices, and amidst what is turning into a global energy crunch, motorists are now spending over $400 million more on gasoline every single day than they were just a year ago. The problems continue to relate to a surge in demand as the global economy recovers, combined with deep cuts to production from early in the pandemic. If Americans can't slow their appetite for fuels, we've got no place for prices to go but up."
DeHaan says the global energy crunch is happening overseas. "In China coal inventories are very low and in Europe where natural gas prices are soaring on low inventories some of that production can be converted to crude oil," says DeHaan. He says that won't happen in the US. "Thankfully, our inventories though a little low, the US is a powerhouse in natural gas production. Oil production could use some improvement, we're still 2 million barrels below pre-COVID," says DeHaan.
DeHaan says the weather has also played a role. "A lot of this was made worse by Hurricane Ida, which shut down Gulf of Mexico natural gas and oil production. We lost 40 million barrels of oil because of Ida," says DeHaan. He adds you can't make up lost time.
April Engram of AAA of Western and Central New York says there's another factor. "Simple demand for gasoline has increased. In recent times, there are fewer restrictions, there are more people on the roads traveling. Fall is here, and kids are going back to school again, so this is more people on the road," says Engram.
Engram says in a typical year, this is the time of year when prices go down. "But the hurricanes we've recently seen in the south, refineries have to shut down. When that happens, it takes time for them to start operations again," says Engram.
Could there be a decrease in prices anytime soon? "It doesn't look that way with potentially this energy crisis looming. There are shipping bottlenecks that make the problem more challenging and timely to solve. I'm hopeful we'll see some relief by the end of the year, but that's not guaranteed," says DeHaan.
DeHaan's best advice is to shop around, with some stations still less than $3 a gallon.
