Gas Prices To Rise This Holiday Season

Posted: Dec 8 2016, 10:46am CST | by , in News | Cars & Vehicles

 

Gas Prices to Rise This Holiday Season
photo: CNN
 

If you’re going over the river and through the woods to Grandma’s or any other house this holiday season, expect to pay more if you’re driving.

Why? Because gas prices are rising. In some Midwestern states, prices have risen 28%, from $1.87 per gallon to $2.39 over the past several weeks. In parts of Florida, they have increased to $2.25 per gallon. 

Nationwide, the average price regular gas is $2.18 per gallon. That’s $0.05 in one week. It’s also $0.14 above per-gallon prices at this time last year. 

And it isn’t over yet. Gas and oil industry and travel planners both think the march upward will continue, by $0.05 to $0.15 per gallon.

The hike in prices will affect people traveling for the holidays. It’s a big hit to the pocketbook, especially when people are spending more on gifts and traveling. It will also mean higher monthly expenses for commuters, eating into their disposable income.

OPEC Production Cuts Are Spurring Increases in Gas Prices

If you think that gas prices are climbing just because it’s the holidays, though, think again.

Prices don’t always go upward during the holidays. In both 2014 and 2015, in fact, gasoline prices dropped in December from November levels.

There are a number of different factors that go into the fluxuation of gas prices. They are currently rising because the Organization of Petroleum Exporting Countries (OPEC), a cartel that contributes a lot of the world’s oil production, has decided to limit the production of oil.

The countries making up OPEC have decided that the current price of oil per barrel does not allow them to produce it at a profit. They want the price up, and the way to do that is to send supplies down.

Unfortunately for U.S. consumers, the slowdown in production is taking place right at the holiday season.

Increases Likely Limited 

The good news? Although consumer prices for gas are going up now, virtually no one thinks we are returning to the bad old days of $3.00 or $4.00 per gallon gas. The national average hit $3.00 per gallon in late October 2014. Some parts of the nation saw prices close to $4.00.

Some observers believe that the upward trend will eventually cause a bubble. Bubbles burst. When the one being formed now does, perhaps prices will come down again.

So chin up in the holidays. The new year may bring lower prices at some point.

This story may contain affiliate links.

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The Author

<a href="/latest_stories/all/all/56" rel="author">Scott Huntington</a>
Scott Huntington is a writer and journalist from Harrisburg PA who covered movies, tech, cars, and more. Check out his blog Off The Throttle or follow him on Twitter @SMHuntington.

 

 

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