Press release from Automobile Association of America:
Today’s national average price for a gallon of gasoline is $4.97, up 10 cents since Monday. One year ago, the price was $3.07. The New York State average is $5.01 ($5.009 to be exact), up 13 cents since Monday. A year ago, the NYS average was $3.09. AAA Western and Central New York (AAA WCNY) reports the following averages:
- Batavia - $4.90 (up 15 cents since Monday)
- Buffalo - $4.89 (up 17 cents since Monday)
- Elmira - $4.97 (up 19 cents since Monday)
- Ithaca - $4.96 (up 17 cents since Monday)
- Rochester - $4.95 (up 16 cents since Monday)
- Rome - $4.96 (up 17 cents since Monday)
- Syracuse - $4.94 (up 20 cents since Monday)
- Watertown - $4.94 (up 14 cents since Monday)
Motorists are feeling pain at the pump even with the recent New York state gas tax cap. When it went into effect last week, statewide prices did drop initially as nationwide prices increased dramatically. However oil prices continue to increase, and the gas tax relief doesn’t amount to enough to counterbalance the increased price of oil, which has a direct impact on what we pay at the pump for gasoline.
For example, right now oil prices range from $121 to $123 per barrel, up from $120 per barrel on Monday. Oil accounts for at least half of each gallon of gas.
Given that gas taxes make up less than a fifth of the price consumers pay at the pump, removing it offers little margin for price decreases when compared to the other factors that contribute to 85% of the price paid by consumers at the pump. Moreover, when external market and economic factors impact the price of oil, rising crude prices can often play an outsized role in pushing pump prices higher. As a result, the impact of gas tax holiday proposals can be limited because any price reduction from the lack of taxes can be quickly offset by a steady increase in oil prices, which is what we are seeing now.
From Gas Buddy:
The national average price of gas in the U.S. surpassed $5 per gallon today for the first time ever, according to GasBuddy, the leading fuel savings platform saving North American drivers the most money on fuel. This long-anticipated milestone comes behind months of gas price increases across the country, accelerated by the rise in seasonal demand amidst supply constraints borne out of the pandemic.
Gas prices have surged in recent weeks as U.S. gasoline inventories have fallen over 25 million barrels, or over one billion gallons, since the start of March amidst a global decline in refining capacity due to the Covid-19 pandemic and accelerated demand going into the summer. The price of oil has also jumped due to escalations stemming from the Russian war on Ukraine, as countries choke off Russian oil supply via sanctions, pushing supply down at a time of rising demand. In addition, U.S. refining capacity has fallen by some 1 million barrels per day over the last three years. All of these factors have created an environment ripe for a surge in gas prices, while Americans balk at prices but continue filling up as demand has seen little decline.
