Record high gas prices are the biggest cause of high-demand inflation in the summer months – and the factors behind the cost of destroying the portfolio show no signs of weakening.
Crude oil prices, which jumped above $ 100 a barrel, now account for 60 percent of the price of a gallon of unleaded petrol, according to April data from the Federal Energy Information Administration.
Crude oil prices rose both amid growing demand as the COVID-19 pandemic weakened and amid a global supply chain disruption caused by Russia’s invasion of Ukraine and subsequent Western sanctions.
Just a year ago, crude oil prices accounted for 52% of the price of a gallon of gas – and only 25% of the price during the April 2020 blockade of COVID, the New York Times reported.
Refining costs represent another 17% of the price per gallon as of April, while 12% of costs go to taxes and 11% to distribution and marketing, according to EIA data.
The national average price per gallon of ordinary unleaded product is now well over $ 5. On Wednesday, the national average for the ordinary unleaded product reached $ 5.014, slightly lower than the record high of $ 5.016 a day earlier, according to the AAA.
Crude oil prices have risen above $ 100 a barrel. NY Post This chart shows the average monthly value for common gas since 1980. NY Post Although the United States produces the most oil in the world, it is the second largest importer of oil.
That’s more than $ 2 from $ 3,076 on the average price per gallon at the time last year – and more than 50 cents on the $ 4.47 average price per gallon a month ago, according to AAA data.
The national average for a gallon of diesel also hit a new record of $ 5.78 on Wednesday, according to the AAA.
Problems with uncontrolled energy spending and uncontrolled inflation have led President Biden and Democrats in Congress to fear angry voters during the November midterm elections.
The national average price of a gallon of plain unleaded is over $ 5.AFP via Getty Images / Patrick T. Fallon
But despite the president’s request Wednesday for Big Oil to increase production, there is no evidence that such an effort would cool pump prices.
Although the United States is the world’s largest oil producer, it is also the world’s second-largest importer of oil – and many gasoline-producing refineries are reluctant to refine what is produced on American soil, according to the Times.
Its refining capacity in the United States peaked at nearly 19 million barrels per day in April 2020, before the effects of the COVID strike and the blockade led to a sharp drop in demand. As a result, oil companies cut staff and closed refineries.
Today, U.S. refineries are operating at 94 percent of their capacity, but production in March was 17.9 barrels a day, less than before the pandemic, according to Reuters.
It is also believed that oil companies are hesitant to reopen closed refineries due to labor shortages, as well as long-term expectations that crude oil prices will fall due to increased supply.
With postal wires
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