The real reason gas prices keep skyrocketing in the US

After visiting my family in Indiana this weekend, I was amazed at how high gas prices are in the Tristate and all other parts of the country.

We all feel how expensive it is to do the normal things we like to do this summer. Driving to work becomes too expensive.

Will we see much needed relief soon? Probably not.

How high are gas prices right now?

According to CNBC, they’ve never been higher.

The average price of a gallon of unleaded gasoline topped $5 nationally for the first time due to increased demand from the reopening of the economy following the pandemic and the depletion of oil supplies resulting in part from the war in Ukraine. Prices should continue to rise during the summer months.

It’s so confusing trying to figure out why we’re hitting record high gas prices. As with most things, everyone has an opinion. So what is the truth? Who or what is really, to tell the truth, to blame?

What is the real reason gas prices are so high?

Many things in the world play a part in a spike in gas prices, but it really all comes down to the economy.

You know, supply and demand. But this time it’s a little different due to the pandemic and the recent flurry of automakers announcing plans to go all-electric in the near future.

GM in January announced plans to phase out gas-powered cars and trucks by 2035 in favor of tailpipe-free electric vehicles.

– Today

In response to this announcement, refineries are very reluctant to build new or reopen refineries that closed during the pandemic if there will be a lack of fuel demand for the foreseeable future.

In addition to KFive’s reports,

Some refineries that produce gasoline, jet fuel, diesel and other petroleum products shut down in the first year of the pandemic when demand slumped. While a few are expected to increase capacity over the next year, others are hesitant to invest in new facilities because the transition to electric vehicles will reduce gasoline demand in the long term.

The United States, although the largest oil producer in the world, lost 900,000 barrels of oil per day, compared to 2019, due to the lack of refineries. That means the supply is down, but we still need as much, if not more, than we ever had.

Some complain, including me, that politicians, including the president, could just tap into our oil reserves and that would help prices go down. But, the president dipped into the reserves and the gas rose anyway.

At the end of March, Biden announced a new exploitation of the strategic petroleum reserve. The average price per gallon has jumped 77 cents since then, which analysts say is partly due to a refining squeeze.

– The Guardian

What can be done to help gas prices start to come down?

It could be up to us drivers. We have to start driving less. By doing this, we could help reduce the demand for gas, thus helping to slowly put an upward spike in supply, which would help bring prices down.

More employees could find themselves doing their jobs from home.

Like during the pandemic, extremely high gas prices could easily make us live and work from home again. It’s a really horrible situation for those who can’t work from home.

Rising energy prices are hitting low-income families the hardest. Retail and fast food workers cannot work from home – they have to travel by car or public transport. The National Energy Assistance Directors Association estimates that the bottom 20% of families could spend 38% of their income on energy, including gasoline this year, up from 27% in 2020.

WATCH: Here are 25 ways to start saving money today

Whether it’s finding cashbacks or simple changes to your daily habits, these money-saving tips can come in handy whether you have a specific savings goal, want to save money, money for retirement or just want to earn a few pennies. It’s never too late to be more financially savvy. Read on to learn more about how you can start saving now. [From: 25 ways you could be saving money today]

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