By Shereen Siewert
Despite low demand, crude oil and prices at the gas pump are continuing a sharp upward trend, a direct result of all major Gulf Coast refineries being impacted by the recent winter storm.
Crude oil and pump prices will soon be more expensive than the highest price of 2020, analysts project. Since Monday, the national average for a gallon of regular gasoline has increased by seven cents to $2.57, according to AAA, with an additional 10- to 15-cent increase per gallon by Monday.
“Consumers can expect to continue paying more to fill up this month, potentially up to 10 cents more a gallon, depending on how high crude goes,” said Jeanette Casselano McGee, AAA spokesperson. “If demand grows, that will further fuel pump price increases.”
On Friday, gas prices in Wisconsin started at $2.17 per gallon. But in Wausau, prices are ranging from $2.49 to $2.59 per gallon at stations in the area, according to GasBuddy.
The situation in Texas caused gas supplies to shrink and could also cause prices to rise in the coming weeks as oil refineries are forced to close because of the weather. Until refineries resume normal operations, supply is expected to remain tight, especially with road conditions and power outages reducing fuel deliveries.
High gas prices are created by high crude oil prices. Oil costs account for 54% of the price of regular gasoline. The remaining 46% comes from distribution and marketing, refining, and taxes, according to the U.S. Energy Information Administration. These inputs don’t change as frequently as oil prices do. When oil prices rise, you can expect to also see the price of gas eventually rise at the pump. A $10 rise in oil prices translates to a $0.25 increase in gas prices over the long term.
According to the U.S. Dept. of Energy, drivers can reduce gas usage in the most obvious way – driving less – but also by increasing fuel efficiency. An easy way to improve fuel efficiency is to keep tires inflated and keeping the engine properly tuned, energy officials say.