Michigan gasoline prices are on the rise again, up, on average, more than $4 a gallon and climbing, with diesel prices now at $5.12 a gallon, having even more serious economic consequences.
Could regular gasoline surge to $5 a gallon — or more?
It’s possible, given that talks have failed and the Strait of Hormuz is still closed.
Why Michigan gas prices are rising again
“Oil prices have been climbing again as markets react to renewed geopolitical tensions and the cancellation of talks between the U.S. and Iran,” Patrick De Haan, head of petroleum analysis at GasBuddy, which also tracks gas prices, said on Monday, April 27. “As a result, gasoline prices are set to rise further this week, with diesel expected to follow.”
Michigan had the biggest weekly increase in the nation
Michigan had the biggest weekly average increase by state in the nation, according to GasBuddy, followed by other Midwest states: Ohio and Wisconsin. Some states — California, Hawaii and Washington — have averages of $5.88, $5.54 and $5.41, respectively.
De Haan expects gas prices to continue to climb.
An increase could pinch summer travel plans and add to the bottom line of producing and transporting goods, and some shipping companies are starting to add surcharges and increase the price of goods.
Jet fuel has already skyrocketed.
How much drivers are paying now
AAA pointed out that the average price of regular unleaded was more than 20 cents a gallon from a week ago and nearly $1 more a gallon than a year ago, which means motorists are paying about $60 to fill a 15-gallon tank.
Diesel was up even more from a year ago, $1.65 a gallon.
Throughout Michigan, AAA said, the most expensive gas price averages were in Marquette, $4.09; metro Detroit, $4.07; and Ann Arbor, $4.04; the least expensive were in Grand Rapids, $3.97; Benton Harbor, $3.97; and Flint, $3.97.
Global tensions driving oil prices higher
“This is indeed the biggest crisis in history,” said International Energy Agency’s Executive Director Fatih Birol last week in an interview with France Inter radio, calling it “huge,” especially “if you combine the effects of the petrol crisis and the gas crisis with Russia.”
About a fifth of the world’s oil travels through the Mideast strait.
What happens next for gas prices
There had been a sense — briefly — that prices might fall, but that ended last week. Since then, President Donald Trump has given ambiguous and conflicting answers on what’s next with the war in the Middle East and gas prices.
Monday, AAA spokeswoman Adrienne Woodland said, “Pump prices are back on the rise.”
The war, now in its ninth week, is beyond when the president had said he expected it to be concluded.
Earlier this month, Reuters reported the U.S. consumer prices increased by the most in nearly four years in March as war with Iran led to “a record surge in the cost of gasoline and diesel, dealing a blow to President Donald Trump, whose approval ratings have been falling.”
Crude oil prices rose in the past week, trading at about $100 a barrel or more, reversing declines as geopolitical tensions re-escalated as U.S.-Iran negotiations collapsed and the United States continued to restrict Iran’s ports, according to GasBuddy.
Traders worry disruptions to global supply could persist or worsen.
If tensions drag on, it could further tighten the world’s global oil supply.
Contact Frank Witsil: 313-222-5022 or fwitsil@freepress.com
This article originally appeared on Detroit Free Press: Michigan gas prices jump the most in the nation, with $5/gallon possible
Reporting by Frank Witsil, Detroit Free Press / Detroit Free Press
USA TODAY Network via Reuters Connect
