Following a few weeks of reprieve for drivers, the U.S. national average price of gasoline could top $4 per gallon within a week, as crude oil prices rallied by about 12% in the three days since Friday amid the all-but-collapsed U.S.-Iran ceasefire.
The renewed hostilities in the Middle East have fueled a new crude oil price rally this week, while tight fuel markets globally are also pushing U.S. prices at the pump higher.
“I’ve seen enough and believe the national average price of gasoline will again reach $4/gal in the next 7-10 days, if not sooner,” Patrick De Haan, head of petroleum analysis at GasBuddy, wrote late on Monday, when crude had surged by 9% on the day following the announcement of U.S. President Donald Trump that the U.S. blockade on Iran would be re-imposed on July 14.
GasBuddy’s key analyst expects price increases of $0.15-0.45 per gallon, depending on price cycling, in the next week or so.
Early this week, the average U.S. national price of gasoline rose for the first time since May, as the re-escalation of hostilities in the entire Middle Eastern region prompted an oil rally with prices hitting more than one-month highs.
As of the end of the day on July 14, the national average was $3.8590 per gallon, according to AAA data. That’s up from the $3.79 average from a week ago.
“The pain at the pump is about to intensify, and this time it’s not one story driving it, it’s two,” GasBuddy’s De Haan wrote earlier this week, noting the double gas price whammy of the re-escalation in the Middle East and Ukraine systematically knocking out Russian refining capacity.
“I now expect the national average price of gasoline to reach $4 per gallon in the next 7-10 days, if not sooner, while the U.S. average diesel price is likely to again reach $5 per gallon by the end of this week, potentially as soon as Friday,” De Haan said.
By Tsvetana Paraskova for Oilprice.com
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