Gas Prices Hit 2023 Highs As Oil Chugs Higher
The prices of gas have touched a new peak of 2023 as on Monday as a pressure on the supply of oil has sent the prices of the refined products to a new high.
The national-average price of gasoline in the United States has hit $3.88, as per AAA. In the western states, the prices are well over the national-average. The average for California sat at $5.69 each gallon.
Diesel prices, which is primarily used to transport commodities through trucks, were up from $0.23 one month before, at $4.57 each gallon.
Other refined products, such as jet fuel, have also seen a substantial rise. Several airlines like Delta, United Airlines, and American heard the alarm on lower profits recently despite the higher fuel costs.
The higher costs of energy are raising certain concerns of a pessimistic impact on the wider economy when the Federal Reserve is planning to curb inflation. Federal officials are expected to hold onto the steady interest rates when they meet this week but still keep their ways open to yet another rate hike within this year.
Energy prices, especially gasoline, were one of the biggest culprits behind the unexpectedly hotter Consumer Price Index print of August, which had been released the previous week.
“The oil issue, the higher gas prices — this should be a reminder to all of us that the Fed is not in charge of inflation,”
former Federal Reserve Board economist Claudia Sahm said to Yahoo Finance.
“These are geopolitical events that are driving energy prices,”
she further added.
Crude has also followed an upward trend in the last three months.
West Texas Intermediate has increased by approximately $23 a barrel since the late of June to stop at $91.48 on Monday.
Saudi Arabia, which is a member of OPEC+, looks forward to keeping the prices of oil elevated as it wishes to fund domestic initiatives in the upcoming years. “I expect crude oil prices to remain above $90 per barrel as OPEC+, and specifically Saudi Arabia, seek higher prices to balance their domestic budget,” Andy Lipor from Lipow Oil Associates said to Yahoo Finance.
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