Some offers on this page are from advertisers who pay us, which may affect which products we write about, but not our recommendations. See our Advertiser Disclosure. Drivers saw some relief at the pump in recent weeks amid news of a ceasefire between the U.S. and Iran, but the decline was short-lived as renewed conflict between the two nations pushed energy prices higher again.
The national average price of gasoline is now over $4 again, with current diesel prices hitting over $5 per gallon, according to AAA. Crude oil prices are back above $80 per barrel, and Brent crude oil is above $88. Several factors are pushing prices up, with geopolitical tensions at the top of mind for consumers, politicians, and economists.
Though experts say it's important to look at the whole picture to better understand how gas prices are moving and why. "It's not just the U.S. and Iran and the Strait of Hormuz that's impacting prices," said Patrick De Haan, head of petroleum analysis at GasBuddy. "In the last probably six weeks or so, we've seen multiple significant Ukrainian attacks on Russian oil refineries." Alongside these external factors, seasonality can contribute to the natural ebb and flow of gas prices throughout the year.
"Generally speaking, we do tend to see gas prices decline in the fall, for the opposite reason of why they go up in the spring," De Haan told Yahoo Finance. "In the fall, people stay closer to home, road trips wind down, people get back to their grind. Temperatures cool off, so there's less outdoor activity, and then we also start to switch back to cheaper winter blends of gasoline in the fall." As for where gas prices could be headed?
De Haan says it's difficult to predict. "A national average, I think, hopefully in the worst case would be $4.50, although if it really gets bad, it could head closer to $5." Experts say it will take time for consumers to feel the ripple effects of lower oil. Changes in crude-oil prices can affect gas prices fairly quickly; however, the comedown from a gasoline price spike isn't always immediate.
While oil prices are a key driver of what you pay at the pump, they don't tell the whole story. Other factors, such as refining costs, disruptions in gasoline distribution, and retailers' price markups, can slow the rate at which gas prices return to normal after a spike. "There is a saying that pump prices rise like a rocket and fall like a feather, and that holds," said David Doherty, head of natural resources research at BloombergNEF.
Extract — continue reading at the source.
