Gas prices are climbing with they should be flat. Winter represents a time of low demand, post holidays. But that’s not the case with crude oil and downstream of that the price of fuel.
WWL went to Triple-A expert Don Redman for an explanation into the rise in fuel prices in January
“We certainly have seen a reversal at the pumps for the motorist,” Redman says. “Just a month ago in Louisiana we were paying about $2.78 a gallon. Today we’re looking at about $3.04 a gallon. And this have everything to do with the price of crude oil. It’s up almost six dollars from a month ago.”
This morning oil is trading at $79.24 a barrel.
“Even though demand right now is down, the sudden news, and it looks like now the economic news is better many had anticipated or forecast,” Redman explains. “And so you’re seeing the price of crude going up and that’s what’s causing the price at the pump to go up.”
Redman says traditionally prices start moving up in spring.
“The concern of course is looking down the road to spring. And that’s where we see some of the biggest price jumps. When refineries get rid of the winter grade of gasoline and start preparing for the summer. That transition period—you’ll see sporadic closing refineries during that period—that’s when we can see prices jump from $.50 cents a gallon to a dollar a gallon by the time we get to June.”
So for the time being, we’re caught paying more for gas.
“Typically, again in springtime, you’ll see those prices jump. Looking at what we paid for in January as versus what we paid for in June. It could be anywhere from $3.50 a gallon to close to $4.00 a gallon depending on how fast the economy grows and how the market responds to that.”
