gas pumps
Gasoline is costly again, up 44% equally of this calendar week versus the average gas prices of 2020. The big SUVs now in brusque supply may be less in demand if prices stay high. It could be worse: Most European countries are paying the equivalent of $5.50-$half dozen.00 a gallon for petrol at present. Pecker Howard

If you're wondering when prices at the gas pump will first leveling off, don't look that to happen anytime soon.

American motorists are paying, on average, $iii.28 a gallon for self-serve regular as of Wednesday (Oct. 13), according to tracking services such as AAA and GasBuddy. That's up more than than 10 cents over the past calendar month and by over a dollar compared to Oct 2020. In parts of Florida, Hawaii and California spikes have hit $5 a gallon.

High Prices Are Bad News for Big SUVs, Pickups

Already, October prices are 44% college than the boilerplate cost of gasoline was in 2020. When fuel prices jump chop-chop, automakers find that buyers tend to delay plans to buy bigger SUVs or pickups, or shift to smaller vehicles, to hybrids and to EVs. With the shortage of new vehicles of all kinds, the shift is less likely in 2021.

"High fuel costs assistance accelerate" the switch from gas-powered vehicles to EVs, Brent Gruber, J.D. Power's senior director of global automotive, said during a media webinar Tuesday. Rise pump prices, combined with a growing line-up of products, could aid boost EV sales in the U.S., he added, though likely non to the caste the shift has gained traction in the UK.

 "I wait the national average volition eclipse $iii.30 this week," said Patrick De Haan, GasBuddy's head of petroleum analysis. "So, in all likelihood, Thanksgiving and Christmas [prices] will be at their highest level in vii years."

De Haan's analogue at AAA isn't any more than optimistic, Andrew Gross pointing to the ongoing surge in petroleum prices. Oil prices accept skyrocketed since the beginning of the year, Brent Crude (a crude-oil course, not a stage name) jumping from $50 a barrel (42 gallons, which yields 19-20 gallons of gasoline) to more than than $lxxx Wednesday.

 "And concluding calendar week's determination by OPEC and its oil-producing allies to not increase production further only exacerbated the upward momentum for crude oil prices," Gross said in a AAA study.

Gas price surge
Gasoline prices per gallon are upward significantly from concluding year's average and relief may not be in sight before 2022. Nautical chart shows yearly average prices for regular gasoline 1978-2021, including the all-time high in 2012. The flatter line shows gas prices adjusted for inflation, using 2020 as the comparison year.

Surging prices come in sharp contrast to what American motorists experienced early in the pandemic: gasoline dipping below $1 a gallon in some parts of the country. Drivers who benefitted from the crisis then are experiencing what payback today.

"It all rolls upwards nether Covid," De Haan told Forbes Wheels.

As the world went into 2020 lockdown, petroleum became a glut on the market place. At one point, it was existence given abroad as tankers sat offshore with no identify to unload. Oil companies slashed production, shutting down wells and laying off thousands of workers. U.Southward. daily oil output cruel from 13 million to 10 meg barrels a day. OPEC, noted De Haan, cutting output by ten%, or near ten meg barrels a day.

But "Americans were simply itching to get out of their homes," he added, and supplies now can't proceed up with demand.

Gas prices
Gas prices over $3.50 a gallon are non uncommon in some states. Florida, Hawaii and California drivers are finding gasoline topping $5 a gallon in some areas. A rule of motorist behavior: Quick runups in price (that don't slide back downward) hurt the sales of big SUVs and pickups non used for piece of work. If it goes up slowly, over a year or more than, motorists adjust to the new normal. Getty

Shortage of Workers to Offland Petroleum, Deliver Gas

Other factors complicate the state of affairs. A shortage of workers has tied up operations at ports in place like Long Beach and Los Angeles, and fifty-fifty when fuel is off-loaded, upwardly to a quarter of the nation'due south fuel trucks sit down idle for a lack of drivers, says the the National Tank Truck Carriers, a trade grouping.

The situation is likely to remain "grim" for some time, said De Haan, with gas prices likely to remain high for at to the lowest degree six months.

The U.Due south. isn't alone. U.k. is facing its own petro-crunch, with shortages hit up to 90% of its pumps over the last month. That led to a surge in demand for battery-electrical vehicles, nevertheless. September BEV sales savage just 5,000 were almost as many equally British motorists bought in all of 2019, according to industry data.

"Loftier fuel costs help accelerate" the switch from gas-powered vehicles to EVs, Brent Gruber, J.D. Power's senior managing director of global automotive, said during a media webinar Tuesday. Rise pump prices, combined with a growing line-up of products, could help heave EV sales in the U.S., he added, though likely non to the degree the shift has gained traction in the Great britain.