In line with rising oil costs, U.S. gas prices reached an eight-month high on Thursday.
According to figures from AAA, the national average price of a gallon of regular unleaded increased to $3.71 on Thursday. That is the highest since November and is up more than 13 cents over the previous week.
Gas prices have increased by at least 15 cents in 16 states in just the last week, and by 20 cents or more in Florida, Iowa, and Indiana.
The upward movement comes in the wake of a sharp increase in oil prices, which have risen by more than $10 per barrel in the previous month to a 3 month high of more than $80.
That rise, in turn, is a result of production decreases by OPEC members and the effects of refinery outages in the United States, both of which are brought on by the extreme summer heat.
According to Andy Gross, the national spokeswoman for AAA, “oil supplies are limited.”
At $4.30 a gallon at the end of July of last year, gas prices are still significantly lower today. But if oil prices continue to rise in the coming weeks, that could have an impact on the inflation report for the following month. The U.S. consumer price index dropped to under 3% in June due in large part to drops in energy prices year over year.
When the American government is pushing for more adoption of clean energy alternatives like electric vehicles, higher gasoline prices are expected to put a pressure on consumers.
The Biden administration’s Inflation Reduction Act provides incentives to consumers looking to switch from gas-powered vehicles to battery-powered vehicles, which are significantly less carbon-intensive but pollute the environment by releasing greenhouse gases such as carbon dioxide, which warm the Earth’s atmosphere.
As the United States moves into its busiest storm season, Gross added, prices may also be impacted. The National Hurricane Center states that mid-August to mid-October sees the most storm activity. Domestic output could be reduced if offshore & Gulf Coast oil sites close due to storm paths.
“We are entering a dangerous period,” warned Gross.