[ad_1]
If you’ve been refueling your vehicle lately, you know gas prices keep going up. At the time of this writing, the average price of a gallon of regular unleaded gasoline in the United States is $ 3.15, according to AAA.
In this article, financial expert Clark Howard will answer in detail one of the questions vehicle owners face this summer: Why do gas prices continue to rise?
Why are gas prices rising?
Historically, gas prices fluctuate according to the price of a barrel of oil on the world market. In a normal cycle, you may be able to predict some price patterns. But Clark says what’s going on now is some kind of anomaly. “It’s kinda crazy how much it has increased,” he says.
Usually when we hit the week after July 4th it’s usually the peak in gas prices for the year – it’s usual, ”he says. “It won’t be usual. “
“In fact, we could see over the next few weeks that prices will continue to rise at the pump because of these much higher prices per barrel of oil, ”he adds.
Understanding what is happening now requires a brief explanation from the decision makers who determine the price of crude oil across the world: OPEC (Organization of the Petroleum Exporting Countries).
Who controls gas prices?
OPEC is an intergovernmental cartel with 13 member countries. It specifies that its mission “is to coordinate and unify the oil policies of its Member Countries and to ensure the stabilization of the oil markets in order to ensure an efficient, economical and regular supply of oil to consumers, a stable income to producers. and a fair return on investment. capital for those who invest in the petroleum industry.
The origins of the gas hikes going on right now can be traced back to the height of the COVID-19 pandemic in 2020, “when demand fell off a cliff,” says Clark. It was at this point that the pricing cartel enacted strict restrictions on oil production that most of its member countries followed.
“What this is going to mean for the immediate future is pain at the pump for your summer driving. It’s not going to go away, ”he said.
When will gas prices go down?
What always tends to happen is that when the price of a barrel goes up, OPEC producers “start cheating on their quotas,” Clark explains. “And there will be magical extra barrels of oil being produced that will solve the supply issues that have driven prices up.”
Clark reckons we’ll see some relief at the pumps by September or October.
Here’s how the next few months should go: “So we have pricing issues for the next two months…” he says.
Clark says there are two additional factors that should help stem the rise in gas prices:
- In the fall, the demand for gas tends to decline in the northern hemisphere.
- The additional oil that is expected to be produced should then affect the prices at the pump. Then “we’ll see the prices start to come back to Earth,” he says.
Hear Clark’s full take on gas prices on his podcast:
How to save on gasoline this summer
In the meantime, here are some steps you can take to ease the shock of high gasoline prices.
1. Don’t skip routine car maintenance
Sticking to a maintenance schedule can save you money.
For example, keeping your tires properly inflated can increase your fuel economy. According to the US Department of Energy, this can save you about a dime per gallon.
Here are some easy ways to maintain your vehicle.
2. Buy gasoline with a Rewards credit card
Clark’s wallet is full of credit cards that benefit him for what he buys. One way to take advantage of this is to use a credit card that offers cash back on gasoline purchases.
The Sam’s Club Mastercard gives you 5% cash back every time you buy fuel. And it is not the only one.
3. Save your trips
If you have errands to do, plan your trips so that you can make multiple stops along a particular route or route. This way you will save money by using less gasoline.
Want to know more ways to be fuel efficient? Here are over 20 ways to save on gas.
More gas saving resources on Clark.com:
[ad_2]
Source link