Gas Prices Hit High For The Year, And Highest Levels In Six Months
The cost of driving got a little more expensive, once again, during the past week, according to the latest survey from the U.S. Energy Information Administration. The weekly EIA survey shows the price of a gallon of regular unleaded went up an even 3¢, bringing the U.S. average price to $3.58.
As always, some regions fared better than others, but this week that only means two regions did not experience an overall price increase. Seven of the nine regions surveyed did experience gas price increases, with the worst being in the Lower Atlantic states, where the cost of driving surged about 6¢, twice the national average.
The price of gas is now the highest it has been in six months, according to both the EIA and a survey by the American Automobile Association. While the AAA survey shows prices slightly lower than the EIA report, at $3.56 per gallon, the price of gas is, undisputably, much higher than it was just three months ago.
At the start of the year, the cost of a gallon of gas was only $3.33; today, the lowest regional fuel prices to be found, on the Gulf Coast, are a penny higher than those reflected in the national average on January 6. Even with the recent spate of price hikes, drivers are paying about 7¢ less for a gallon of gas than they were at this time in 2013.
For drivers on the West Coast, not including California, the year-over-year cost at the pump is down about 15¢ per gallon. However, those gaps are considerably narrower than they were just a few weeks ago. As recently as February 17, the nationally-averaged year-over-year price differential was about 37¢.
Three Key Factors Affecting Consumer Gas Prices
The rising cost of fuel, at least for the moment, can be traced to a confluence of three factors, the first being consumer demand. The spring driving season is underway, with the spring break traffic continuing to take hold from the midwest to the eastern seaboard. That is likely to continue at least through Easter, which arrives later than usual this year, on April 20.
The summer driving season is coming almost immediately after that, but with bids for domestic crude oil remaining near the $100 mark during the past several days, it is not likely that drivers will see much of a break in May, when the current crude oil contracts come due.
The final ingredient that is impacting prices is the cost of ethanol additives, the cost of which is higher due to harsh winter conditions in the United States and the crisis in Ukraine. TurnpikeInfo.com first reported three weeks ago the Ukraine crisis could add to the cost of ethanol additives used for summer blends of gasoline.
Bloomberg was reporting Tuesday that ethanol supplies were ten percent lower than they were at this time last year, and at least one analyst was quoted as saying it would be difficult for energy suppliers to handle the logistics of increasing the supply, at last for the moment.
Worse, especially for consumers, is the fact ethanol prices are also at their highest levels in eight years, which could figure prominently into coming price fluctuations for drivers.