Gasoline prices in all 50 states, including across the oil-rich Gulf Coast and Permian Basin region, are sitting above $4 a gallon as drivers prepare to head into Memorial Day weekend.
The national US average was $4.56 per gallon on Thursday, up 43% from one year ago, and 13% higher than a month ago, according to AAA data.
California, which relies heavily on fuel imports and has high taxes and fees, has already topped $6 a gallon. Other Western regions remain well above the national average, and even the Gulf Coast states sit above the $4 mark.
States such as Texas, Louisiana, and Oklahoma are typically among the last to experience sharp price increases because they sit at the center of the US refining and oil production system.
Read more: How oil price shocks ripple through your wallet, from gas to groceries
Comments from President Trump suggesting the US and Iran are in the “final stages” of reaching a deal sent oil prices tumbling on Wednesday, marking their sharpest one-day decline in more than a month. Prices were back above $100 per barrel on Thursday.
Gasbuddy’s head of petroleum analysis, Patrick De Haan, predicted that prices could drop if the advancements on Iran war peace efforts followed through. However, “If this is another hope that doesn’t translate into a reopening of the Strait, prices will likely surge again next week,” said De Haan on X.
Meanwhile, Tom Kloza, chief energy adviser at Gulf Oil, noted drops of $0.20 to $0.25 in the gasoline spot market seem more likely to be a “one-off” rather than a change in the trend.
“The capricious oil market gave gasoline retailers a Memorial Day weekend present,” said Kloza on X.
Consumers have seen the price of gasoline rise at the same time the summer driving season moves into full gear with a more expensive blend for the warmer months at the pump. Strategists point out that the situation with refined fuels could worsen if the Strait of Hormuz, a critical artery for global oil flows, does not reopen soon.
Since transit through the strait is at a near standstill, global refineries cannot secure enough raw crude oil to process. The result is what JPMorgan describes as a “refining and end-user fuel crisis.”
The strategists noted that even if crude oil prices remain relatively flat in the low $100s, the price of gasoline could keep rising until demand destruction kicks in or consumers pull back.
Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on X at @ines_ferre.
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