After dropping slightly last month, gas prices hit an all-time high on Tuesday, with Americans all over the country paying more than usual to fill up their cars.
According to the American Automobile Association, the average price for a gallon of gas in the United States hit $4.37. The cost of diesel also broke records, reaching an average of $5.55 per gallon.
Rising costs at the gas pump reflect a general price increase across most goods. This week, the Department of Labor released April’s inflation numbers and showed an increase of 8.3 percent over April 2021.
Why Gas Prices Are Increasing
There are several compounding factors behind the dramatic increase in fuel prices over the last year. Most recently, the Russian invasion of Ukraine – which prompted U.S. President Joe Biden to implement sanctions against Russian oil exporters – has driven up costs by way of decreasing supply.
While the U.S. is not dependent on oil from Russia, it is one of the biggest exporters of oil in the world.
Prices were increasing before the outbreak of Russia’s attack of Ukraine on February 24, however. The average cost of gas was about to surpass $4 earlier this year before the war began, in part because of a decrease in production from OPEC countries in the wake of the COVID-19 pandemic.
As fuel prices plummeted in early 2020, a result of global lockdowns, OPEC countries and its allies all agreed to reduce production to stabilize prices. In April of 2020, crude oil traded at negative prices for the first time in history.
Since then, President Joe Biden has repeatedly requested that OPEC countries increase production – only to bet met with a firm “no” every time.
Robert McNally, the president of Rapidan Energy Group, said earlier this year that the Biden administration was “suddenly interested in more drilling, not less.”
“People are more worried about high oil prices than anything else,” he said, noting how President Joe Biden appeared to be making a U-turn on his policy of stopping all new drilling in the United States.
Prices Won’t Go Down Soon
Speaking to USA Today, Kpler Lead Oil Analyst Matt Smith said that Americans “should get used to higher gasoline prices.”
“We shouldn’t expect to see them dropping back to $2 a gallon. Those times seem to have passed,” Smith said.
As demand for gas only continues to increase, now that the national economy has largely returned to normal in the wake of COVID-19 lockdowns, prices are likely to remain high for some time. Only when the U.S. federal government secures new suppliers to make up for the Russian oil import shortfall will prices begin to fall.
Demand is also set to increase in the coming weeks and months, with the summer travel season kicking off on Memorial Day weekend and continuing towards the end of the year. Furthermore, an increase in air traffic as Americans return to air travel will also put pressure on a short fuel supply.
Jack Buckby is a British author, counter-extremism researcher, and journalist based in New York. Reporting on the U.K., Europe, and the U.S., he works to analyze and understand left-wing and right-wing radicalization, and reports on Western governments’ approaches to the pressing issues of today. His books and research papers explore these themes and propose pragmatic solutions to our increasingly polarized society.