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Today’s average US gas price is $3.74 per gallon, down $0.01 from yesterday, $0.07 from last week and $0.30 from last month.
The weekly drop in gas prices, while small, is a welcome reprieve for Americans who have struggled with skyrocketing prices at the pump. An increase in demand for petrol following Covid lockdowns, combined with a reduced supply, forced prices up. Western sanctions against Russian gas imports due to the war in Ukraine exacerbated the problem.
Although gas prices may be falling, they remain high. The average price of a gallon of gas a year ago today was $3.18.
Which state has the highest gas prices?
California has the highest price for gas, averaging $5.34 per gallon. gallon of regular gas.
Which state has the lowest gas prices?
Texas has the lowest price for gas, averaging $3.19 per gallon. gallon of regular gas.
Why are gas prices so high?
Oil is a traditionally volatile commodity as it trades on futures, not current prices. But high demand for crude oil and limited supply pushed gas prices to record levels this year – and the geopolitical situation made it worse.
During the onset of the Covid-19 pandemic, demand for gasoline fell as stay-at-home orders prevented people from hitting the road. Oil producers responded to the drop in demand by cutting production – but when the lockdowns were lifted, there was a massive increase in demand, and not enough oil to keep up.
There was also a flurry of pipeline problems last year that contributed to a delay in oil production, including a cyber attack on the Colonial Pipeline that shut it down for six days, as well as a spill at another pipeline later in the year.
The war in Ukraine exacerbated these supply and demand problems. Russia, which produces about 10% of the world’s oil supply, is under heavy sanctions by Western countries; in particular, the US has completely banned Russian oil imports. Cutting off part of the global oil supply chain means that a relatively significant portion of the supply is now gone, and countries are scrambling to find alternatives.
In an effort to increase supply, President Joe Biden authorized the largest release of oil from global reserves in history. An analysis by the Treasury Department estimates that the releases, both domestic and international, have reduced gasoline prices by up to 40 cents per gallon.