For the first time ever, the national average price of gas surpassed $5 per gallon, according to gas price trackers GasBuddy and American Automobile Association. As of Monday, the price hovered around $5.01, AAA reported. After the price of a gallon of gas surged nearly $2 in the past year, though, experts warn we haven’t seen the worst of it.
“I think we do have some more pain in our future when it comes to gas prices,” GasBuddy Head of Petroleum Analysis Patrick De Haan said in an interview with Straight Arrow News. “So far, Americans just last week saw a record for consumption this year, the highest demand we’ve seen so far this year, and it’s coming amidst higher prices. So until Americans slow down, I don’t think we’re going to see much relief.
“My concern is that heading into the summer, as more Americans likely are going to hit the road in July and August, we could see any major hurricane or any disruption further cause prices to jump.”
De Haan said that while gas consumption is the highest it has been this year, it’s still below historical levels, indicating that high prices are preventing some level of Americans from hitting the road.
While President Joe Biden has repeatedly blamed Russia’s war in Ukraine for record gas prices, Republicans point fingers at his clean energy policies and revoking the Keystone XL Pipeline permit. De Haan said if there’s a main culprit, however, it’s COVID-19, when Americans abruptly stopped driving and traveling, causing oil production to go offline, before seemingly ramping up demand overnight.
“We are seeing production go up, it’s up by about a million barrels a day compared to where it was a year ago,” De Haan said. “But we’re still about a million barrels below pre-COVID production and those numbers are improving but it’s taken quite a bit of time, given all of the supply chain bottlenecks that oil companies along with many other areas of the economy are facing.”
Even with crude oil trading around $120 a barrel, De Haan said there is some reluctance among oil producers to ramp up production given Biden’s energy policies and attacks on the industry. The move away from fossil fuels is causing uncertainty in the sphere.
“That does not inspire confidence, especially in the oil sector, which has been under attack from the Biden administration,” he said.
De Haan said Biden has the power to reverse some of his earlier stances to encourage investment in the industry and would advise the president to provide clarity on what is to be expected energy-wise over the next several years if he wants producers to put in billions of dollars to ramp up production.