Why is a large part of the country heading for $ 4 worth of gas?

A consortium of oil-producing countries has removed more than a million barrels a day from the market – the least of the problems that weigh on gas prices in the United States.

In the United States, regular gasoline averages $ 2.77 per gallon, up 7 cents a week and 29 cents a month, according to GasBuddy. Last year, gas prices reached $ 2.98 at the beginning of the Memorial Day weekend.

Soaring prices are particularly pronounced on the west coast. According to GasBuddy, California already has the highest gasoline prices in the country, averaging $ 3.77 per gallon for regular gasoline, up 49 cents from last month's average. Patrick DeHaan, head of oil analysis at GasBuddy, warned Sunday in a tweet that prices had not yet risen, predicting that the average price in California would exceed $ 4 this week.

"It's nothing short of spectacular on the west coast. A series of three problems lead to soaring gas prices, "DeHaan said.

Oil prices are rising, but this is only about a quarter of the recent rising gasoline prices faced by American drivers, he said. A bigger problem is that we are at about the same time of the year when many refineries are planning to do maintenance work as they turn every year to fuels based on blends. 39; summer.

This year, unexpected problems put more refineries offline, which reduced inventories. "This exhaustive list of planned and unplanned refinery problems is having a dramatic impact on prices," said DeHaan. "It's almost inevitable every year that there is a refinery problem."

Ethanol is another factor driving up the price of gasoline. In fact, corn-based fuel refiners must mix with summer gasoline blends. Flooding in major Midwest US ethanol production centers, such as Chicago, disrupted ethanol delivery and made supplies scarce.

As a result, motorists in different parts of the country will continue to see their prices rise in the coming weeks, but at different rates.

"At OPIS, we still think that gas prices for the driving season will be slightly lower than last year. The west coast is the main exception to this rule, "said Tom Kloza, global leader of energy analysis at Oil Price Information Service. "We added 2.4 million barrels a day of refining capacity, but everything was added in the Midwest and Gulf Coast," he said.

"This is the fastest seasonal increase we have seen since 2012 and may soon exceed that of 2012. I think we could see the national average go up by 15 to 30 cents, which would put us slightly above $ 3. brand, predicts DeHaan.

"I think they're probably going to find some relief in May or June, but you're going to see a lot of $ 4 gasoline in California this week and next week," Kloza said. Gasoline prices in other western states such as Washington, Oregon and Nevada have also risen sharply.

"The second quarter is expensive in these states – in many cases $ 1.25 more than the rest of the country," said Kloza. "In the rest of the country, it feels like a normal spring."

Beyond the immediate tightening of supply on the West Coast, analysts said they were expecting geopolitical and OPEC activities and the following. Non-member allies like Russia (mentioned by OPEC + analysts) have an increased influence on prices.

"At the moment, oil prices seem to be rising, albeit slowly," said Sukrit Vijayakar, director of the Mumbai-based Trifecta Energy Consulting firm. "We will have to wait and watch to see what happens at these levels."

"I think OPEC is doing too much obedience," Kloza said. "They are cutting more than they promised," he said of the cartel's commitment to reduce production by 1.2 million barrels per day from that date. year. These cuts are exacerbated by conflicts in oil-exporting countries, such as Venezuela – which faces US sanctions – and Libya.

"I do not think we've had that little leeway between the balance of supply and demand for a number of years. OPEC plays a key role in this process, "said DeHaan.

"The United States is at a dead end with OPEC + and speculators are intent on raising prices, which could have repercussions in the United States," said Vijayakar.

Although President Donald Trump has written off OPEC on Twitter in the past, analysts say the White House has relatively little power over the cartel's activities.

The Trump administration has implemented other tactics to influence prices, such as granting last-minute waivers to eight countries before the sanctions imposed on Iran last year, mitigating the impact of these sanctions on prices.

The waivers are expected to expire in early May, but Vijayakar hinted that rising oil prices could prompt the US to extend exemptions from certain countries, including China and India. "In order to control the situation, Trump could allow further extension to these countries," he said.

But analysts say there are more price factors that are beyond the control of US policymakers. "I think oil will continue to be a pressure point on gas prices this summer," DeHaan said. "How high are we going there is more a function of what we see on a global scale … All that will be needed is a geopolitical outbreak that disrupts the flow of oil . "