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Gas Prices Edge Up Amid Global Tensions and Surging Domestic Demand

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Despite a backdrop of unsettling international developments and a notable surge in domestic gasoline consumption, the increase in the national average price for a gallon of gas has been relatively modest. Image for illustration purposes
Despite a backdrop of unsettling international developments and a notable surge in domestic gasoline consumption, the increase in the national average price for a gallon of gas has been relatively modest. Image for illustration purposes
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Texas Border Business

Despite a backdrop of unsettling international developments and a notable surge in domestic gasoline consumption, the increase in the national average price for a gallon of gas has been relatively modest, ticking up just three cents to $3.56 in the past week, according to the American Automobile Association (AAA) www.gasprices.aaa.com

This minor adjustment comes amid a complex global scenario where oil prices have ascended to the mid-$80s per barrel, influenced by geopolitical strife and a spike in demand.

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Andrew Gross, a spokesperson for AAA, highlights the recent escalations in the Ukraine-Russia conflict and rising tensions in the Middle East as significant contributors to the uptick in oil prices. “Renewed Ukrainian attacks on Russia’s oil infrastructure and increasing tension in the Middle East spiked oil prices recently,” Gross explained. He elaborated on the direct impact of these costs on consumers, stating, “And with the cost of oil accounting for roughly 60% of what we pay at the pump, there will likely be some upward pressure on prices.”

The latest data from the Energy Information Administration (EIA) corroborates the surge in demand, showing an increase from 8.72 to 9.23 million barrels per day (b/d) last week. Concurrently, the total domestic gasoline stocks have decreased, dropping by 4.2 million barrels to 227.8 million barrels. This combination of higher demand and escalating oil prices sets the stage for a potential rise in pump prices shortly.

The current national average is $3.56, marking an increase of 21 cents over the past month and six cents higher than last year. The seasonal trends observed in gas prices, which typically rise in the spring, peaking in May, are also expected to influence the pricing patterns this year. However, global geopolitical tensions and a tighter gap between national and state price averages further complicated this year’s dynamics.

In a state-specific look, Texas presents an interesting case. Data from GasBuddy indicates that while Texas gas prices have historically been lower than the national average — with a difference of about 50 cents per gallon in November — this gap has narrowed significantly, with the savings per gallon now reduced to approximately 25 cents. As of yesterday, the national average for a gallon of gas stood at $3.61, compared to $3.23 in Texas, underscoring the nationwide trend of rising fuel costs.

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These developments point to a complex interplay of factors affecting gas prices, from international oil market dynamics and domestic demand to seasonal variations and regional disparities. Consumers will likely see further gas price fluctuations driven by global events and domestic consumption patterns as the situation evolves.

Source – AAA

https://gasprices.aaa.com/?state=TX&utm_source=newsletter&utm_medium=email&utm_campaign=newsletter_axioslocal_dallas&stream=top

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