AAA: Rising oil prices could push up gas prices in Carolina | Mmweekly

CHARLOTTE – Gas prices in the Carolinas fell another one to two cents last week as motorists continue to find discounts at the pump – but those prices could soon rise due to soaring crude oil prices, which is approaching $ 80 a barrel. Since the world price of oil is almost half of what consumers pay at the pump, higher oil costs will generally lead to higher gasoline costs.

“In times of scarcity, it doesn’t take much to put upward pressure on the overall price of oil,” said Tiffany Wright, spokesperson for AAA – The Auto Club Group in the Carolinas. “January gas prices are often reduced due to lower demand for fuel, but this downward trend may end soon. “

The current average price of gas in North Carolina is $ 3.05, down one cent a week. This is 8 cents less than a month ago and 86 cents more than last year. The current average price of gas in South Carolina is $ 3.01, down two cents a week. This average is the same as a month ago and 92 cents more than last year.

The national average for a gallon of gasoline rose two cents to $ 3.30, three cents less than a month ago and $ 1.01 more than last year.

According to new data from the Energy Information Administration, total national gasoline inventories increased by 10.1 million barrels last week. In contrast, demand for gasoline increased from 9.72 million b / d to 8.17 million b / d.

Typically, prices at the pump decline due to lower demand for gas and an increase in total inventories, but continued growth in the price of crude oil has helped push prices up at the pump. As oil prices continue to climb close to $ 80 a barrel, prices at the pump will likely follow suit.

Although prices fell on Friday due to fluctuations in contract prices at the start of the year and demand concerns over the COVID-19 Omicron variant, crude prices generally rose last week after the EIA reported that total domestic crude inventories fell 2.1 million barrels last week. The current level of inventories is around 14% lower than at the end of December 2020, contributing to the pressure on domestic crude prices. For this week, crude prices could continue to climb if the next EIA report shows further decline in inventories.

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Felix J. Dixon