Why Are Gasoline Prices Creeping Up?

The average price of regular gasoline in the U.S. is increasing, AAA Gas Prices data shows.

On January 17, the average price of gasoline was $3.327 per gallon, according to the AAA Gas Prices website, which outlined that the previous day’s average gasoline price stood at $3.305 per gallon, Tuesday’s week ago average gasoline price stood at $3.270 per gallon, and Tuesday’s month ago average gasoline price stood at $3.159 per gallon.

So why is it going up? An AAA spokesperson told Rigzone that “oil prices moving higher has helped to push gas prices higher”.

“However, based on current data from EIA, lackluster gas demand and increasing supply have helped to limit price increases,” the AAA spokesperson added.

Both West Texas Intermediate (WTI) and Brent oil prices have climbed notably since January 4, when WTI closed at $72.84 per barrel and Brent closed at $77.84 per barrel. On January 17, WTI closed at $80.18 per barrel, while Brent closed at $85.92 per barrel. At the time of writing, WTI is trading at $80.84 per barrel and Brent is trading at $86.40 per barrel.

According to the U.S. Energy Information Administration’s (EIA) latest gasoline and diesel fuel update, which was released yesterday and pegged the retail price of regular gasoline at $3.69 per gallon in November 2022, 55 percent of that total went towards crude oil costs, 18 percent went towards distribution and marketing costs, 14 percent went towards taxes, and 13 percent went towards refining costs.

In its latest short term energy outlook (STEO), which was published earlier this month, the EIA projected that the retail gasoline price will hit $3.32 per gallon this year and $3.09 per gallon in 2024. The retail gasoline price came in at $3.97 per gallon in 2022, the EIA’s latest STEO highlighted.

To contact the author, email andreas.exarheas@rigzone.com