By Lauren Fix, The Car Coach
Prices at the gas pump are rising yet again. Today’s national average gas price is $4.59 (as of 5.23.2022). As we head into the summer months, the demand jumps, and prices are going to continue to jump up as well. We are hearing threats of $6 per gallon gasoline and the State of Washington is bracing for $10 per gallon gas. This is absurd!
Prices across the country were already high before the most recent jumps. Gas prices are above $6 in California and every state is over four dollars a gallon. Gas prices are projected to be at or above $4.75 a gallon before the end of the month.
Prices are still going higher, that’s up more than 40 cents from a month ago when prices stood at $4.08. Much of the most recent jump has come just in the past few days as prices rose 16 cents per gallon between May 9 and May 16. Diesel prices are twice the price from last year and for those with electric vehicles, electricity prices are up 11.1 percent.
What is the future pricing of gas, diesel, and electric prices?
Gasoline inventories are dropping as we reach Memorial Day and diesel is at an all-time high which means food prices and anything else you buy that is delivered will cost more too. High gas prices impact planes, trucks, tractors, and almost all vehicles, which all add to Inflation that has continued to be at a very high level. Some say this is price gouging—when all costs increase, those costs are passed on to you. Electric cars are not the answer. Remember electricity prices are up 11.1 percent, too.
There are a lot of factors for increased gas and diesel prices.
One of which is the Biden administration has canceled oil and gas lease sales in the Gulf of Mexico and Alaska’s Cook Inlet, which deals a blow to potential domestic fuel protection as gas prices reach new highs across the country. The Cook Inlet lease sale would not move forward because of a “lack of industry interest in leasing in the area” due to high costs. In the Gulf of Mexico, the department canceled two lease sales, citing “conflicting court rulings that impacted work on these proposed sales. Besides bad timing on these two sites, President Biden imposed a moratorium on the sale of new leases one week after his inauguration, but the order was later blocked by a Louisiana federal judge who granted a preliminary injunction to 13 states that claimed they would suffer “irreparable injury” from the White House move.
To add more injury to the industry, last month, the Interior Department announced it was restarting the sale of oil and gas leases on federal land, but reduced the amount of land under consideration by 80 percent and increased the amount of royalties energy companies would have to pay the government if they extracted anything of value. Then they added 11 new regulations and fees, making it even more expensive to drill on existing leases.
It is important to note that there are 10.9 million acres of offshore federal waters already under lease to the industry. The industry is not producing on more than three-quarters (75.75 percent of 8.26 million acres). There must be a reason why that wasn’t disclosed.
The Russian invasion of Ukraine hit oil markets on a global basis and has hit gas and fuel prices hard globally. We slowed drilling in the US which also help drive up the price at the pump as governments turned away energy supplies from Moscow.
Additionally, refineries are running at full speed and full capacity, but we have lost five percent of our refining capacity; this is due to additional costs and aged equipment. We are now asking Venezuela to send us their oil. This would then make us reliant on another dictator. We are also buying oil from OPEC as we have in the past, but they are not increasing production no matter how much we ask for more.
The Bottom Line
Solutions include opening up leasing and permits for drilling again here in the USA, restarting the keystone pipeline, and using Canadian oil instead of Venezuelan. Canada has been offering to sell its oil but for some reason, we keep turning them down even though they are to our north (closer than Venezuelan oil) and a friendly government instead of an enemy to the US.
We are in line for a prolonged period of higher energy and gas prices.
More restrictions, regulations, and taxes are not helping the situation. Let’s work with our neighbors to the north and become energy independent to lower costs for everyone.
There is so much more to discuss on this, put your comments below and let’s start the conversation.
Lauren is the CEO of Automotive Aspects and the Editor-in-Chief of Car Coach Reports, a global automotive news outlet. She is an automotive contributor to national and local television news shows, including Fox News, Fox Business, CNN International, The Weather Channel, Inside Edition, Local Now News, Community Digital News, and more. Lauren also co-hosts a regular show on ABC.com with Paul Brian called “His Turn – Her Turn” and hosts regular radio segments on USA Radio – DayBreak.
Lauren is honored to be inducted into the Women’s Transportation Hall of Fame and a Board Member of the Buffalo Motorcar Museum and Juror / President for the North American Car, Utility & Truck of the Year Awards.
Check her out on Twitter and Instagram @LaurenFix.
