YOUNGSTOWN, Ohio (WKBN) – At least one local fuel supplier thinks the recent hike in gas prices was more of a knee-jerk reaction to problems in the Middle East, and not necessarily a sign of problems to come.
With retail prices for gas still sitting around $2.85 a gallon Tuesday afternoon, business was sparse at a number of local pumps, even though wholesale fuel prices had already started falling.
“Nymex crude down 6% and gasoline and diesel fuel down about 4.5%,” said Paul Lyden, Lyden Oil Company.
Lyden said he knew the weekend bombings of Saudi Arabian oil facilities would drive up prices even before the markets opened Monday morning. By the time they closed on Monday, costs for wholesale products had jumped by almost 25 cents a gallon.
“This is just a hiccup, a knee-jerk reaction. They’re just letting the dust settle,” he said.
Lyden said the price hike wasn’t over supply issues, but more about speculation over possible retaliation for the bombings.
“In my own opinion, this is like a poke in the eye to the… on the bear. They’re poking the bear, being the United States and President Trump due to the sanctions that we have on Iran,” he said.
“It is a lot more of those speculative forces that are pushing prices up right now,” said Dr. Sarah Jenyk, an economics professor at Youngstown State University.
Jenyk studies energy issues. She said while political uncertainty tends to make the markets nervous, it’s too early to know how the bombings will play out in the long term.
“We tend to see consumers in general start to really change their behavior once we hit the $3.25, $3.50 a gallon mark,” she said.
For now, Lyden and his staff will keep watching the prices tick up or down.
“You know what that means for us? A lot of paperwork ’cause we have to do our pricing every day,” Lyden said.