Why are gas prices rising? Experts point to extreme heat and oil production cuts

NEW YORK (AP) — Drivers are on board another headache at the pump as US gas prices continue to rise.

The national average for gas prices was about $3.78 per gallon. gallon Tuesday — about 25 cents higher than what was seen a month ago, according to motor club AAA. While today’s prices at the pump remain far lower than they were last yearas energy costs rose worldwide in the months following Russia’s invasion of Ukraine, experts say such a jump is unusual.

“Usually it takes a hurricane to move prices this much,” said AAA spokesman Andrew Gross, who said the increase is particularly interesting since “fewer people are fueling up” their cars this summer compared to years past.

In the US, gasoline prices are highly dependent on crude oil. West Texas Intermediate crude, the US benchmark, has remained above $80 a barrel. barrel since Thursday and stood above $81 on Tuesday afternoon. That’s a $12 jump since July 3, according to OPIS global head of energy analysis Tom Kloza.

There are a few factors driving oil prices higher, Gross and Kloza say, including cuts in global supply production and the effects of this summer’s extreme heat on refineries. Here’s what you need to know.

WHY ARE GAS PRICES INCREASING? PROVIDES HEAT AND PRODUCTION CUTTERS

This summer’s record temperatures are partly to blame for rising gas prices.

“While the heat may keep people at home, it also prevents refineries from making refined products,” Gross explained, noting that refineries are typically designed to operate between 32 and 95 degrees Fahrenheit (0 and 35 degrees Celsius). “They don’t like extremes of temperature because they are inherently dangerous places… So they dial back production for safety reasons, but that then limits supply.”

According to Kloza, there is about 10 million daily barrels of US refining capacity on the Gulf Coast. The heat wave has caused those refineries to operate below normal capacity — resulting in a loss of hundreds of thousands of barrels each day, he said.

Still, “the fact that some refiners are struggling has meant that the ones that are able to operate have really good profits,” he said. Today’s U.S. domestic demand is about 9 million barrels a day, about half a million below expectations for the peak summer months, but the country exports a lot of gasoline, he added.

In addition to the heat, Kloza pointed to crude supply cuts from major producing countries in the OPEC+ alliance. In July, for example, Saudi Arabia began reducing how much oil it sends to the global economy 1 million barrels every day. Russia also exports less, he said.

The cuts are not OPEC-wide, Gross noted. As inflation easeshe suspects that better economic prospects may also put pressure on oil worldwide.

WHICH STATES HAVE THE HIGHEST GAS PRICES TODAY?

As always, certain parts of the United States face higher gas prices than others — due to factors ranging from routine maintenance at regional refineries to limited supplies in some states.

On Tuesday, according to AAA, California had the highest gas prices in the nation, averaging $5.01 per gallon. gallon. Washington and Oregon followed at $4.96 and $4.92, respectively.

Mississippi had the lowest average at about $3.29 per gallon, followed by $3.39 in Louisiana and $3.40 in Alabama.

WILL GAS PRICES CONTINUE TO CLIMB?

It’s hard to know what gas prices will look like in the coming weeks, experts say.

While relief from the heat can hopefully be expected as we head into the fall, both Gross and Kloza pointed to the risk of hurricanes — which of course lead to refinery shutdowns.

“If you could guarantee that we’re not going to have tropical storm force or hurricane force winds in the Gulf of Mexico, I’d say it’s going to be clear sailing for the rest of the year. But that’s a real fly in the ointment,” Kloza said, pointing on unprecedented water temperatures the region has seen recently.

HOW CAN I SAVE GAS?

If you’re looking to save money and cut down on trips to the pump, there are a few ways you can maximize your mileage per trip. gallon.

An important habit is to keep track of getting your tire pressure checked, Gross said. In addition to safety risks, low tire pressure is “not maximizing your fuel efficiency” and costs you more money down the road, he said.

AAA offer additional gas-saving tips — which include using cruise control when possible, not overfilling your tank at the pump, and removing unnecessary items from your car’s trunk to cut down on excess weight.