DAYTON — The recent high gas prices are forcing some people to not drive as much, yet prices keep going higher.
At this point it probably feels like everyday gas prices are going up and up. So much of this boils down to supply and demand, but we need to see a significant drop in demand to see things change in the short term.
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With the prices continuing to climb higher and higher the demand has dropped compared to this time in 2019. Despite that, don’t expect to see a significant drop in prices in the near future.
Kara Kitchens, AAA Public Affairs Manager said, “it shoots up like a rocket, but it floats down like a feather. When we see that change, it will gradually come down.”
In the summer months there’s peaks and valleys to demand. So even it its low now it could stay high in anticipation of the next big travel day.
“It’s kind of pulled back a little bit but we expect to see the demand go back again as we get near the fourth of July holiday,” Hitchens said,
Even with lower demand, the supply remains even lower. Gasoline storage remains well below the average for this time of year. The Energy Information Administration even says storage levels have continued to fall, which is just one of the man factors impacting the price at the pump.
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“Refineries just aren’t producing what they were before pre-pandemic. They haven’t gone back to pre-pandemic levels so that means the supply is down a bit,’ Hitchens said.
One of the things affecting the increased gas prices beside the war in Ukraine and supply and demand, is the price of crude oil is still high which leads to higher costs at the pump.
Historically, the price we pay is slow to catch up with demand and falling prices of oil too.
If the economy goes into a recession that would lead to the price of gas going down, but how much of a drop remains to be seen and the terrible words of new normal now may include $5 gas.
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