Crude Oil prices are likely to hit a seven-year high this week, resulting in higher gas prices across the country. Crude is currently trading at around $76 per barrel. The last crude was over $76.40 per barrel, and the national average gas price was $3.25 in November and October 2014. High demand for gasoline over the summer and high crude prices are both driving up gas prices.
At the OPEC+ summit this past weekend, no agreement was reached on increasing Crude Oil production. Crude prices will most certainly continue to rise as a result of the postponed decision. If the expected agreement is implemented, which would enhance supply by 500,000 barrels per day, it might assist satisfy petroleum demand growth predictions as immunization efforts continue. The national average price of gasoline is $3.13 per gallon.
This represents a 40% gain from January 1st of this year. By the end of the summer, that figure is likely to rise another 10 to 20 cents. In Virginia, the average cost of a gallon of gas is $2.94, which is also the cost in the Charlottesville area. Morgan Dean, Senior Specialist, Public and Government Affairs for AAA Mid-Atlantic, said, “Crude Oil makes up, price-wise, about 50 percent of what drivers pay at the pump, so the higher the Crude Oil, the higher it’s going to be for you at the pump. You also have the other factor of supply and demand working together right now, and with demand being so high, that always tends to push up gas prices as well.”
According to AAA Mid-Atlantic, Tropical Storm Elsa is not expected to have a statewide influence on gas prices. Still, flooding, heavy rainfall, and windy weather might cause localized supply-chain disruptions.