Over the past year, gas prices have spiked exponentially. What has caused the high rise in gas prices? Why are certain towns and areas priced higher than others? Who is behind the sudden spike in gas prices?
According to AAA, gas prices at a national average float around $3.39 a gallon, over a dollar higher than last year. Some states such as California have areas that top out at over $5 a gallon. As gas prices rise across the nation, the threat it poses to working families, traveling, and farming is alarming and unsettling, to say the least.
Why is it that gas prices differ so drastically depending on the area and town?
Rapid City is a neighboring city to Spearfish, only about 45 minutes apart from each other. Seemingly, the gas prices in Spearfish are on average 10 cents higher than that in Rapid. A local commuter from Rapid to Spearfish named Jamin Wurtz asks “What’s the difference?” Three primary factors play into different gas prices per city tax, margins, and fuel blends.
Gas prices historically trigger upwards during the summer months as travel continues to increase as well. Continuing on, while travel months have passed, the increase in the price per gallon of gas has not. Many Americans across the nation feel the dent gas prices now make in their wallet when filling up at the local station.
Considering local gas price conflicts, the issue is most likely the margin of gas stations. According to Google Maps, in Spearfish
prices averaged $2.97 a gallon in 2009. Soon after the economy began to recover, gas prices averaged an all-time high of $4.25 a gallon, according to the US Energy Information Administration.
The price of crude oil is another aspect effecting this issue. Crude oil is refined into the gasoline we use at pumps today and is the primary supply in the market. If there is more supply of crude oil, then the price tends to drop and vice versa. Problems with the distribution of crude oil cause conflict in the industry. The problems are presented as military conflicts on imported oil, COVID-19, and the supply of local pipelines.
As the nation’s gas prices continue to rise there is not much any one individual can do but spend and choose wisely. Apps such
as Gas Buddy pull up local prices of gas stations to find which can be the most bang for your buck when filling up a car. In addition, gas prices and taxes vary from state to state considering the fact that Arizona’s gas prices are almost one whole dollar cheaper than California’s.
What is the next solution for Americans to save money if gas prices keep increasing?
there are around 13 local gas stations, but in Rapid, there are upwards of 24 gas stations. The profit margin of gas can vary depending on the nearby competition. Since Rapid has more gas stations, it is more of a competitive market than Spearfish gas stations, meaning they have to lower gas prices to beat out the rest of the competition nearby. This in turn causes the 10 to 20 cent different price per gallon.
Different factors play into the raising of gas prices, such as the economic recessions. The COVID-19 pandemic presented some of the lowest gas prices in years as well as the economic recession of 2008. When gas prices and the economy shatter the relapse for gas prices is unprecedented. As the economy fell in 2008, gas