GasBuddy: Surging gas prices rise to highest level in months

GasBuddy reports today that the national average price of gasoline has risen 35 cents per gallon since January to $2.58 per gallon and now stands at its highest level since November as seasonal changes and refinery problems push prices higher.

Yet as prices rise across the country, the pain has not been equal from state-to-state.

Gas prices in the Midwest have seen a large surge in recent weeks with average gas prices in Michigan leading the nation, rising 75 cents per gallon from their 2019 low, followed by Ohio, up 67 cents, Illinois, up 64 cents, Indiana, up 59 cents and Wisconsin, up 54 cents. Florida joined the Midwest with average prices up 53 cents from their 2019 low. Average gas prices in every state have begun to move higher, with the biggest pinch coming at pumps in the Midwest, South, Southeast and mid-Atlantic states. The West Coast, however, has escaped the biggest hikes- for now.

“It’s been nothing short of madness at the pumps since early January with retail gasoline prices on a tear, especially in the Great Lakes,” said Patrick DeHaan, head of petroleum analysis at GasBuddy. “Excess inventory of winter gasoline paved the way for deep discounts in some states after the holidays, and now with the transition to cleaner, more expensive summer gasoline underway, supply has tightened, and those previous deep discounts have vaporized. The news doesn’t get much better either: motorists can expect the jumps at the pump to continue into April, and perhaps even lasting up to Memorial Day, when the transition to summer gasoline and refinery maintenance have generally wrapped up.”

Oil prices have also had an impact on rising prices, albeit a smaller role than refinery maintenance and the transition to summer gasoline. OPEC countries along with Russia have continued to limit output in an effort to boost prices, which have recently risen to a four-month high, just shy of $59 per barrel. Ongoing turmoil in Venezuela is also playing a role in rising oil prices, thanks to a near country-wide electricity outage that curbed the country’s ability to export crude oil.

The United States EPA mandates specifications for gasoline on refiners each year from May 1September 15 in most areas, while some areas like California introduce summer gasoline earlier in the year and keep it well into autumn. Once the transition is completed in May and refiners boost production following maintenance, gas prices may ease, but they still are likely to rise further until then.