Seesawing gas prices will only go up from now on, experts say

Published 5:00 pm Friday, February 25, 2022

Though the so-called “Russo-Ukrainian War” has been ongoing for eight years, the invasion into Ukraine by Russia Feb. 24 put American stocks on a roller coaster ride for relatively obvious reasons. The Dow Jones Industrial Average fell 830 points Thursday as the Nasdaq fell about 1.5 percent. Germany and Russian stocks saw the the same kinds of activity.

Analysts saw it coming, of course. How could they not with the Russian posturing and world leaders taking shots across an imaginary bow?

That’s why concern about gas prices was another thing many people across the United States watched. With the country dependent on foreign oil once again, analysts, law makers and the general public all have a interest in which way prices tend to lean.

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Last week, the nation’s average gas price climbed 3.2 cents from the week before, reported GasBuddy from data compiled from more than 11 million individual price reports covering more than 150,000 gas stations across the country. “The national average is up 20.7 cents from a month ago and 88.9 cents per gallon higher than a year ago,” GasBuddy’s most recent report stated. “The national average price of diesel has risen 5.7 cents in the last week and stands at $3.93 per gallon, the highest since May 20, 2014.”

While Russian forces entered the outskirts of the Ukraine capital of Kyiv Friday, gas prices in Brookhaven were doing their own battle dance. One minute the gas at a North Brookhaven gas station sat at $3.39 a gallon for the cheapest choice. This was at 12:39 p.m.

By 1:15 p.m., that same gas at that same station was $3.27 – keeping in competition with the gas station across Highway 51 South.

That happened in several gas stations in Brookhaven Friday as we watched. Stations attempted to keep up with the Jones as much as they could, but by the time the weekend comes, it’s a sure bet all gas prices will be a lot higher than they were Friday afternoon. That’s because the gas being brought to those stations is now going to cost the stations more, which means the price at the pump goes up as well.

Gas Buddy data reported that the impact of the invasion this week sent oil prices up another $2 a barrel more and gas another 8-10 cents per gallon. It will continue to increase slowly and rise to 10-15 cents a gallon more, analysts said.

Russia is the second to third largest oil producer. The United States is producing 11.6 million barrels of oil a day; that’s 1.3 million lower than prior to COVID-19. With America no longer oil independent, the extra oil has to come from somewhere. That means our purchasing power is limited to availability, regardless of cost. Russia may use gas as a weapon by limiting exports and its relationship with China might interfere with any trade negotiation.

In California and Alaska, where gasoline prices are always sky high, gas could rise to $5 a gallon in the next week. GasBuddy analysts said they’ve already seen an adjustment because gas stations are now paying more for gas. “Gas will rise in small increments, but will rise,” they reported. “It will be a slow rise and not a steep one. By March, we could see $4 a gallon in most of the country. The national average is about $3.55 right now and we’ll see anything that relies on gasoline go up as well, whether that’s transporting items or making them.

“For the near future, in summer or fall, we will have some small drops in gas prices, but it will be pennies per gallon. Pennies.”

But it will be temporary if the war is ongoing. Analyst Dan Dicker told Yahoo Finance that “a sustained price of $100 a barrel would translate to $5 a gallon at the pump in 2022,” CNet reported.

And his opinion is on the low end of other analysts’ opinions on how high gas prices could go.

We visited local gas stations Friday from 12:39 to 1:15 p.m. to check gas prices. The following is the name of the station and the price of gas at the time of our tour:

$3.37 Handy Mart

$3.39 Texaco BKwik

$3.37 A One Stop

$3.39 Cracker Barrel North

$3.25 Blue Sky

$3.39 Marathon

$3.25 Walmart

$3.27 Exxon

$3.27 BKwik Shell

$3.39 Cracker Barrel Shell

$3.29 Highway 84 Chevron

$3.39 Exxon on corner of highways 84 and 51 South

$3.39 Fleetwood Mart Shell North

$3.29 Exxon C Store

Crude oil rose Thursday above $105 a barrel for the first time since 2014, reported, before falling to around $80 a barrel. Prices will continue to rise and fall as events occur.

it’s just fluid that way.