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Gas Prices Surge for Spring Break

Tuesday, April 02, 2024

Primary Blog/Stock Market/Gas Prices Surge for Spring Break
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This past week, gas prices surged, surpassing last year's average on the back of escalating oil prices, dwindling inventories, and the debut of a pricier summer gas blend. The summer pump prices are expected to hit $4/gallon (highest since the summer of 2022, and just in time for Americans and their summer travel.

By Friday, the national gas average had hit $3.53 per gallon, nearly $0.10 higher than a year ago, as per AAA data.

"Gas prices, much like the changing seasons, are on the rise with the onset of spring," remarked AAA spokesperson Andrew Gross.

Friday marked the first time since late December that the national average outpaced the previous year.

In California, home to the highest gas prices, rates flirted with $4.97 per gallon, reflecting a $0.14 uptick from the same day in the past year.

Traditionally, gasoline prices ascend in the spring as more motorists take to the roads and refineries transition to a costlier summer fuel concoction. This year, retail prices have also felt the impact of a steady uptick in crude oil futures.

As of Wednesday, crude oil prices are right around $81 per barrel. Both Brent and WTI have witnessed a $10 per barrel surge since the year began.

Recent weeks have witnessed a climb in crude prices due to ongoing production cuts by the OPEC+ alliance and refinery disruptions in Russia following Ukrainian drone assaults.

Despite dwindling inventories, many traders reckon the swift price rally warrants a correction. Nonetheless, the drop in Russia's global exports owing to Ukrainian attacks will affect supply as the driving season kicks off, shared Dennis Kissler, senior vice president at BOK Financial.

Motorists in the Midwest could see a mild deceleration in pump price hikes following the resumption of full operations at BP's Whiting, Indiana refinery, the region's largest, after a Feb. 1 power outage. In Illinois, where gas prices surged by roughly $0.22 per gallon last week, the state average hit $3.92 on Friday.

​The upsurge in gas prices in February played a pivotal role in the unforeseen uptick in inflation reported last week.

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