Gasoline prices are climbing at near historic rates
HUNTSVILLE, Ala. (WAFF) – Gas prices in Alabama are rising again. This is the second price peak of 2022.
Prices are going up due to the highly anticipated Memorial Day and the summer travel season.
“We normally see increases at this time of year because of that, but I have to be honest the amount of the jump is more than we had anticipated and more than what we typically see at this time of year. year,” AAA spokesman Clay Ingram said.
In one week, gasoline prices climbed $0.25. The average gas price in Alabama is $4.12, just four cents below the all-time high set in March.
Ingram says the Russian invasion of Ukraine is underpinning the price hike.
“I think what we need to see happen to bring those prices down is to see the Russian Ukraine situation resolve itself and take all that volatility and raw material market anxiety out of crude oil,” Ingram said.
Only 8% of American oil is imported from Russia, but this has an impact on the oil supply in Europe, which increases the price of crude oil. Before the Russian invasion, a barrel of oil cost between $50 and $70, but now it costs more than $100.
“Even though we don’t have supply issues in the United States, we still have to pay that world price for crude oil,” Ingram said. “It’s a globally traded commodity, just like everyone has to pay. There’s no way around it, there’s no exemption to it.
Many people face rapidly rising prices while their salaries remain the same. The US Bureau of Labor Statistics reports that inflation is rising rapidly.
The federal authorities are trying to lower prices. UAH economics professor Dr. Wafa Orman said the Federal Reserve was raising interest rates to bring down inflation. According to the April Consumer Price Index report, costs rose 8.3% year-on-year.
“From the perspective of the Federal Reserves, the reason they are raising interest rates is to gently reduce spending and at the same time encourage people to save more,” Dr. Orman said.
Rising interest rates mean it will be more expensive to borrow money for big purchases like a house or a car.
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