AAA explains why gas prices are increasing

Local News

AAA has connected the rise in gas prices to COVID-19 vaccines

(WKBN) – Prices at the pump are trending upward right now because the cost per barrel of crude oil is going up and is currently sitting around $57 per barrel.

“It’s increasing on market speculation about a vaccine rolling out and on the back of OPEC (Organization of the Petroleum Exporting Countries) deciding to keep production cuts unchanged, which is a decision influenced by the pandemic and its effect on gasoline demand, crude oil demand,” said Jim Garrity, of AAA.

Garrity said vaccines create a sense of optimism and that optimism translates into more people traveling, driving, flying and going on cruises. That, in turn, creates a higher demand for crude oil to power cars, planes and boats.

“Crude oil demand has been so low during the pandemic,” Garrity said. “There was a point when oil prices dipped below zero dollars a barrel.”

Now the demand is going back up, and oil prices are returning to what they were around this time last year, according to Garrity. For comparison, last summer, it was around $30 to $40 a barrel.

“I think people have gotten used to gasoline prices when they go to fill up being 25 to 50 cents cheaper than they were the previous year. We’re starting to tighten that gap again, though,” Garrity said.

Garrity also said gasoline prices fluctuate in Ohio more than other places because there’s many local stations competing with each other.

AAA has a county-by-county gas prices map on its website.

While oil prices are hard to predict, and many factors play into the price locally, nationally and globally, Garrity said that drivers might see prices going up over time.

“As we get into an era where more vaccines are rolling out, giving people more optimism to travel, to take road trips, maybe if more workspaces start welcoming people back into their offices, that could have an effect on demand, which could, in turn, have an effect on gasoline prices bringing them back to what you would consider a seasonal norm so to speak, but maybe even higher,” Garrity said.

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