The price at the pump: Is it time to hit the road? And will the dipping gas prices last?

Prices at the pump are almost tolerable again. If you’ve been putting off a road trip because of them, now is the time to go. The Sum notes: The reprieve may not last.

TO SUM IT UP

• Gas prices shot to over a $5 a gallon nationally this summer, forcing many people to change their driving habits.

• But now prices have gone down for the past several weeks.

• Are you ready to hit the road? Now could be the time since experts say the sinking prices may not last for long.

THE BACKGROUND

• High demand, slow production and global issues led to rising gas prices. In some cities, the price topped $6 per gallon.

• The last time prices were so high? July 2008 when a gallon cost $4.114.

• Prices are still higher than they were a year ago. Right now, gas is averaging $4.139 per gallon. A month ago prices were at $4.807.

• In August 2021, the average cost for a gallon of gas was $3.188.

WHAT’S HAPPENING

• One reason for the price drop: concerns over a recession. The Federal Reserve has hiked interest rates in an attempt to battle inflation. But our willingness to drive could push prices up again.

• And then there’s hurricane season that lasts until November. If a hurricane along the Gulf Coast struck a refinery, it could devastate the fuel supply and send prices soaring.

• Plus, Russia is reducing gas flow to Europe. The EU previously announced sanctions.

WHY IT MATTERS

• When we spend more on gas, we don’t have as much to spend on other items. That impacts the broader economy.

• There are 130 petroleum refineries in the U.S., producing 18 million barrels a day. But their capacity has shrunk over the years, which could be bad news for years to come.

• Lower-income families, with longer drives to work and older vehicles, are most at risk to feel the negative impacts of rising gas prices.

SOURCES

• Politico: Why expensive gasoline is here to stay
• New York Times: Gas Prices, a Big Inflation Factor, Are Coming Down Sharply
• Vox: 4 factors that could determine if gas prices will keep falling
• AAA: Gas Prices
• Reuters: U.S. gasoline prices are finally falling. Why?
• Forbes: $5 Milestone: Gas Prices Hit An All-Time National High
• CNN: 11 simple ways to soften the blow of high gas prices on your road trip

READ MORE ABOUT THIS IN THE SUM

The Sum breaks down complex economic issues and how they impact your life in just a few minutes a day. Follow thesum.news on Instagram for the full story.

This story was originally published August 12, 2022 at 4:37 PM.

The Sum

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The Sum breaks down complex economic issues and how they impact your life in just a few minutes a day. Follow @thesum.news on Instagram for the full story.