Global Tensions Push Oil Prices Higher, Gas Prices Follow
washington d.c. – Uncertainty over Russia’s intentions towards Ukraine is contributing to higher crude oil prices, which are nearing $90.00 a barrel. Russia is a member of OPEC+, and any sanctions based on its actions towards Ukraine could cause it to withhold crude oil from the global market.
Rising oil prices will lead to higher prices at the pump for drivers. The national average for a gallon of gasoline rose to $3.36, three cents more than a week ago.
According to new data from the Energy Information Administration (EIA), total national gasoline inventories increased by 1.3 million barrels to 247.9 million barrels last week. On the other hand, gasoline demand increased slightly, from 8.22 million bpd to 8.51 million bpd.
The increase still puts gas demand in a typical range for the winter driving season, which pre-COVID was 8.8 million bpd in mid-January 2020. Continued growth in crude oil prices has helped keep pump prices high. If oil prices continue to climb toward $90.00 a barrel, prices at the pump will likely follow.
The current national average of $3.36 is eight cents higher than a month ago and 94 cents higher than a year ago.
Top 10 weekly increases nationwide: Florida (+12 cents), Indiana (+10 cents), Ohio (+9 cents), Kentucky (+8 cents), Georgia (+7 cents), South Carolina (+7 cents), Tennessee (+6 cents), Illinois (+6 cents), Alabama (+5 cents) and New York (+5 cents).
The 10 most expensive markets in the country: California ($4.64), Hawaii ($4.38), Washington ($3.95), Oregon ($3.92), Nevada ($3.80), Alaska ($3.75), Washington, DC ($3.58), Arizona ($3.56), New York ($3.54), and Pennsylvania ($3.53).
Oil market dynamics
At the close of Friday’s official trading session, WTI was up 21 cents to settle at $86.82. The cost of crude oil rose last week despite the EIA’s report that total domestic crude inventories rose by 2.4 million barrels to 416.2 million barrels.
The current crude inventory level is approximately 13% lower than in mid-January 2021, contributing to pressure on domestic crude prices. For this week, crude prices could continue to climb if the next weekly report from the EIA shows a decrease in total inventory.
Motorists can find current gas prices along their route with the free AAA Mobile app for iPhone, iPad and Android. The app can also plot a route, find discounts, book a hotel, and access AAA roadside assistance. Learn more at AAA.com/mobile.
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