Uncertainty over Russia’s intentions toward Ukraine is contributing to higher crude oil prices, which are closing in on $90 per barrel. Russia is a member of OPEC+, and any sanctions based on their actions toward Ukraine may cause it to withhold crude oil from the global market. Higher oil prices will lead to higher gas prices for drivers. The national average for a gallon of gas has risen to $3.36, three cents more than a week ago.
“At the moment, only one person knows why Russia is threatening Ukraine, and that’s Russian President Vladimir Putin,” said Andrew Gross, AAA spokesperson. “And the tensions along the Ukrainian border have helped push crude oil prices higher almost daily.”
According to new data from the Energy Information Administration (EIA), total domestic gasoline stocks grew by 1.3 million bbl to 247.9 million bbl last week. On the other hand, gasoline demand rose slightly from 8.22 million b/d to 8.51 million b/d. The increase still puts gas demand in a typical range for the winter driving season, which pre-COVID was 8.8 million b/d in mid-January 2020. Continued growth in crude oil prices has helped maintain elevated pump prices. If oil prices continue to climb toward $90 a barrel, pump prices will likely follow suit.
Today’s national average of $3.36 is eight cents more than a month ago and 94 cents more than a year ago.
The nation’s top 10 largest weekly increases: Florida (+12 cents), Indiana (+10 cents), Ohio (+9 cents), Kentucky (+8 cents), Georgia (+7 cents), South Carolina (+7 cents), Tennessee (+6 cents), Illinois (+6 cents), Alabama (+5 cents) and New York (+5 cents).
The nation’s top 10 most expensive markets: California ($4.64), Hawaii ($4.38), Washington ($3.95), Oregon ($3.92), Nevada ($3.80), Alaska ($3.75), Washington, D.C. ($3.58), Arizona ($3.56), New York ($3.54) and Pennsylvania ($3.53).
Oil Market Dynamics
At the close of Friday’s formal trading session, WTI increased by 21 cents to settle at $86.82. The cost of crude oil rose last week despite EIA reporting that total domestic crude stocks increased by 2.4 million bbl to 416.2 million bbl. The current crude stock level is approximately 13 percent lower than in mid-January 2021, contributing to pressure on domestic crude prices. For this week, crude prices could continue to climb if EIA’s next weekly report shows a decrease in total inventory.
Motorists can find current gas prices along their route with the free AAA Mobile app for iPhone, iPad, and Android. The app can also map a route, find discounts, book a hotel, and access AAA roadside assistance. Learn more at AAA.com/mobile.