Gas Prices Soar to Highest Levels Since 2014, Due to Increased Demand and Decreased Supply
By Yehudit Garmaise
The average national price of gas just keeps soaring upwards.
In the past week, the average price of gas, nationwide, has jumped up 5.2 cents to reach $3.25 per gallon: gas price’s highest cost in seven years, according to GasBuddy, which compiled data compiled from more than 150,000 gas stations across the country.
This week’s national average price of gas continues to rise after seeing a 7.5 cent increase since last month and a $1.08 jump up since this time last year.
Also in the last week, the national average price of diesel, which now stands at $3.45 per gallon, has soared 10.4 cents in the last week.
“Last week saw oil prices advance to their highest in seven years, with a barrel of West Texas Intermediate crude oil surpassing the critical $80 per barrel level,” said Patrick De Haan, who heads petroleum analysis for GasBuddy.
De Haan blamed the increase in gas prices on the Organization of the Petroleum Exporting Countries (OPEC), in which 13 countries that host more than 81.5% of the globe’s oil reserves greatly influence global oil prices.
OPEC, which was founded in 1960 in Bagdad, and is comprised of Algeria, Angola, Equatorial Guinea, Gabon, Iran, Iraq, Kuwait, Libya, Nigeria, Republic of the Congo, Saudi Arabia, United Arab Emirates, and Venezuela, agreed not to raise oil production more than it had already agreed to in July, explained De Haan.
While OPEC says its mission is to "coordinate and unify the petroleum policies of its member countries and to ensure the stabilization of oil markets, economists often call OPEC a cartel, which is an association of manufacturers or suppliers who aim to maintain prices at high levels and restrict competition.
For instance, OPEC cooperates to reduce market competition, while enjoying state immunity under international law.
“The OPEC decision caused an immediate reaction in oil prices, and amidst what is turning into a global energy crunch, motorists are now spending more than $400 million more on gasoline every single day than they were just a year ago,” De Haan said. “The problems continue to relate to a surge in demand as the global economy recovers, combined with deep cuts to production from early in the pandemic.
“If Americans can’t slow their appetite for fuels, we’ve got no place for prices to go but up.”