Uh oh, gas prices are heading north again. Nationwide gas prices ticked up 15 cents in just the past week, reaching $3.71 per gallon as the heat wave hitting Texas and Louisiana slowed down oil refinery production. Oil prices have hiked by $4 to hover at around $80 a barrel.
This is a significant development as the nation’s mood runs on gas prices — when they rise, economic vibes worsen. Plus, rising energy prices keep inflation levels elevated.
Refineries, which turn crude oil into products like gasoline, don’t function as efficiently in 100°F+ weather as they do at 75F.
Meanwhile, demand for gas typically rises in the summer, as millions of holidaymakers take to the national highways, further driving up prices.
U.S. gasoline inventories are at their lowest July level since 2015, Patrick De Haan, head of petroleum analysis at GasBuddy, said recently.
Interestingly, it’s developments like this that stimulate more people, thinking of a potential switch from gas-powered vehicles to electric cars, to make the plunge earlier than later. With tax incentives for many locally produced EVs and with Tesla revising their pricing structures, and lowering the sticker prices of some cars, we can expect more punters to head into Tesla, and other EV maker showrooms over the later summer months.
Prices are still nowhere near the high levels we saw last summer when prices reached $3.95 a gallon. We also have to be wary of the imminent hurricane season, as storms could also affect refineries and push prices up even further. Just how these gas price hikes stimulate EV purchases will be something to watch out for.