LYNCHBURG, Tenn. — Just in time for spring break, gasoline prices are trending upwards.
With each passing day, the price of gasoline gets more expensive. In the past 20 days, gas prices have risen a total of 23 cents nationwide, 29 cents in Florida, 28 cents in Georgia and 29 cents in Tennessee.
“Rising oil prices, increased demand, and reduced gasoline supplies have forced motorists to pay more money at the pumps in recent weeks,” said Mark Jenkins, spokesman, AAA-The Auto Club Group. “And it may not get any cheaper anytime soon. AAA forecasts that prices could rise a total of 30-50 cents by Memorial Day weekend.”
The rapid price increase has been reflected locally.
On Tuesday morning the price for one gallon of regular unleaded at Woodard’s Market in Lynchburg was $1.89; at Bedford-Moore Co-op, a gallon of regular unleaded was $1.99 (unleaded containing ethanol was $1.69); while a gallon of regular unleaded at Lynchburg Jiffy Mart was $1.89.
Two-thirds of the price of gasoline is typically influenced by the price of crude oil, and the fact that oil prices have risen 28 percent in the past month explains why gasoline is also more expensive. In fact, WTI oil reached its highest daily settlement of the year at $40.20 a barrel last Thursday. The weekly average price of $38.32 a barrel is the highest since the first week in December.
“Reported cuts in production and a weakening U.S. dollar are causing the global price of crude oil to move higher,” Jenkins added. “Speculation about whether the price of crude has bottomed-out is ongoing and attention is once again being focused on an upcoming OPEC meeting scheduled for April 17. During this meeting the cartel is expected to make a final decision on plans to freeze production at January levels, and if successful this may help reduce the market’s current oversupply.”
Crude oil however, is not the only factor pushing pump prices higher. An increased number of refineries began seasonal maintenance last week, thus reducing the supply of gasoline in the market, at a time when demand increases for the spring travel season.
All of these factors made it more expensive for gas stations to buy gasoline last week. The wholesale price for a gallon of regular unleaded was 20 percent higher compared to the week before. When gas is more expensive for retailers to purchase, it becomes more expensive for motorists.
Twelve months ago, the average price for a gallon of regular unleaded in Tennessee was $3.28, while the national average was $3.53.
AAA updates fuel price averages daily online at <http://www.fuelgaugereport.aaa.com>. Every day up to 120,000 stations are surveyed based on credit card swipes and direct feeds in cooperation with the Oil Price Information Service (OPIS) and Wright Express for unmatched statistical reliability. All average retail prices in this report are for a gallon of regular, unleaded gasoline.