May 19, 2022

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Gas prices soared overnight – the biggest jump since Hurricane Katrina

Gas prices soared overnight - the biggest jump since Hurricane Katrina

The national average price for a gallon of regular gas was $3.84 a gallon on Friday, according to the AAA. This is the highest price since September 2012 and 11 cents higher from Thursday.

Gas prices have risen 18 cents since Wednesday and 29 cents since then Russia’s invasion of Ukraine Eight days ago. Each of these increases represented the biggest price hike since then Hurricane Katrina It hit the US Gulf Coast in 2005, decimating the country’s oil and gas industry, according to the Oil Price Information Service, which collects data from 140,000 gas stations across the country for AAA price averages.

“That’s not the end of it. We’ve already raised another 14 cents on wholesale gas prices this morning,” said Tom Kluza, global head of energy analysis at Opis. He said that the increases in wholesale gas prices are likely to be transmitted to consumers in a short time.

“It’s completely out of control,” he said.

The median price a year ago was $2.75 a gallon, as prices were still recovering from the plunge early in the pandemic. Stay-at-home orders and business closures slashed demand for gasoline.

The average household consumes about 90 gallons a month, Kloza said, so a $1.09 increase in gas prices would cost a family about $98 a month, or just under $1,200 over the course of a year.

Kloza said he could see the average price rise to a new record high of $4.25 to $4.50 per gallon. He said that the rapid rise in gas prices makes a particularly strong impression on the public, compared to the slow but steady increase in prices.

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“When you get increments that fast, and that’s exciting, you really burn the audience,” he said.

California’s statewide average jumped 13 cents overnight to $5.07 a gallon, making it the first state ever to have an average price over $5 a gallon.

There are now nine states — California, Hawaii, Nevada, Oregon, Washington, Alaska, Illinois, New York and Pennsylvania — where the average price is already well above $4 a gallon, with New York and Pennsylvania over the $4 mark with the latest reading.

Two other states—Arizona and Connecticut, as well as Washington, D.C.—are just pennies away from that $4 average.

The average price for a gallon of diesel is now $4.26 a gallon. to hit 4 bucks last weekend. While relatively few American passenger cars use diesel, nearly all large trucks depend on it. Most trucking companies have a schedule of fuel surcharges based on average prices, which means that the cost of moving nearly all goods is increasing for companies, an increase in cost that is also likely to be passed on to consumers in the form of higher prices.
Sanctions imposed on the Russian economy following its invasion of Ukraine have so far excluded Russian oil exports. But the merchants were Reluctance to buy Russian oil Due to uncertainty about the ability to close the deal with the restrictions placed on the Russian banking sector, as well as concerns about finding oil tankers willing to call in Russian ports to load any oil purchased.