How a global energy crisis could affect the US
New York (CNN Business)California gas prices hit an average price of $4.658 a gallon Friday, about a penny short of the highest recorded average price of $4.671 for regular gasoline set in October 2012, according to AAA.
America’s largest state has the highest gas prices in the country. The national average dropped slightly to $3.416 Friday.
AAA said heavy rainstorms in Northern California have pinched production capacity, which then trickled down to Southern California — just like what happened in Louisiana with Hurricane Ida.
“It’s a bit of a supply crunch we have right now, there’s nothing major, until the refineries in Northern California can get back up to full production capacity,” Jeffrey Spring, Corporate Communications Manager of the Automobile Club of Southern California said.
Prices are pushing $5 in some areas, including Northern California’s Humboldt County, where the average price was $4.971 Friday. The Bay Area has surged to over $4.80.
Gas prices have been increasing steadily throughout the year as fuel demand grows around the globe and suppliers have been unable — or unwilling — to produce more oil. Although US oil prices have surged by more than 65% this year, US oil production is about 14% below the levels of the end of 2019, before Covid erupted.
Gasoline prices have surged to seven-year highs and Wall Street banks are warning that $100 or even $120 oil is on its way.
Prices haven’t plateaued quite yet, Spring said.
“What’s happening up in the Bay Area indicates that maybe we’re at the tippy top of this price increases, barring any other issues,” Spring said. “So we’re hoping by the end of the year that things will start heading downward.”
California reached its record price in 2012 following refinery glitches that caused prices to spike for a few weeks before coming back down.
Source: Read Full Article