Why are gas prices rising?

It’s no secret that gas prices have been fluctuating and on the rise for the last several years. Causing concern across the world, fuel prices are on the rise again. In a webinar by Fleet Safety and Efficiency, the average price of gas is said to have gone up 62 cents since 2012 and it is predicted to rise another 6% (about 24 cents).
An article called “Why Are Gas Prices Rising?” blames the combination of rising demand and reduced supply for the increase in fuel prices. As the article explains, the worldwide economic recovery has increased demand but geopolitical risks have caused short supply.
The biggest factor in the fuel price equation is crude oil. The price of crude oil is set globally by the interactions of thousands of buyers and sellers in both physical and future markets. Therefore, other factors to consider in the fuel price trend are inventories, exchange rates, investments, spare capacity, weather events, OPEC (Organization of the Petroleum Exporting Countries) production decisions and non-OPEC supply growth.
“Why Are Gas Prices Rising?” breaks down this phenomenon as follows:

With crude oil at these prices, a standard 42-gallon barrel translates to $1.90 to $2.85 a gallon at the pump. Excise taxes add another 49 cents a gallon on average nationwide. So the price for gasoline is already at $2.40 or more per gallon even before adding the cost of refining, transporting, and selling the gasoline at retail outlets. Taken together, crude oil costs and taxes account for more than 74 percent of what people are paying at the pump.

So how can we save at the pump?

There are several ways to achieve higher fuel efficiency. Some of the most commonly suggested tactics include driving slower, reducing idle time, regular vehicle maintenance, and properly inflated tires. One of the more creative ways to save on fuel is to plan trips in advance. Combining errands into one trip and avoiding rush hour can save a tremendous amount of fuel. Lastly, abrupt starts use up twice as much fuel and should also be avoided. These tactics will help save fuel and improve your vehicle’s performance.

 

“Why Are Gas Prices Rising?.” Why Are Gas Prices Rising?. Web. 6 Sept. 2013. <http://gaspricesexplained.org/>.