The Mysterious Case of Rising Gas Prices

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Avery Chalk

Gas prices have reached an all time high for many American drivers.

Avery Chalk, Writer

As gasoline prices insidiously creep upwards, illuminated menacingly on service station signs, drivers young and old find themselves complaining about the bank-breaking cost of fueling their cars. With no end in sight, it can be easy to blame the President, pandemic, or even foreign policy for this unfortunate trend.

However, the real reason is much more complicated than the presence of any single catalyst aforementioned. Instead, it is a combination of all of these factors as the world adjusts to post-Pandemic life and global uncertainty.

In short, the sudden rise in gasoline costs is due largely to supply and demand. This is an economic principle that explains interactions between sellers and consumers. If there are large quantities of products with no buyers to claim them, prices drop to incentivize consumers to open their wallets.

Gasoline is a premium in America today, and many companies capitalize on that. (Avery Chalk)

This was the case during the lockdown. With cars sitting dormant in the driveways of America throughout quarantine, many gas corporations drastically reduced their rates to stay in business.

On the other hand, if there is high interest in a product, it becomes a premium (and thus sells for higher value). With cars returning to the road, companies are raising prices to rectify untimely 2020 losses.

Gasoline isn’t only a premium because of quarantine woes, however. Global conflict has impacted the oil industry tremendously, especially within the ongoing war in Ukraine. The Organization of Petroleum Exporting Countries (OPEC) is an intergovernmental organization created by the world’s top oil suppliers, and has a significant role in this trend. Its purpose is to regulate oil prices and the production of these raw materials. With uncertainty abroad, OPEC has yet to ramp up oil production to its former levels – and drivers everywhere feel the pressure.

Amidst the conflict, President Biden has taken steps to sever Russian economic ties. In March, he announced that the United States would no longer buy gas imports from Russia in order to support Ukrainian interests. Without involving America in physical battle, this was the government’s best course of action to combat Putin’s international agendas. However, it caused strain on domestic and Middle Eastern resources.

Nihara Lijan, a junior at FHS, says that it currently costs her $60 to fill up her tank. While Biden has influenced gasoline availability in America, Lijan says that climbing prices aren’t solely attributed to his policies.

I think gas prices have more to do with natural resource availability than President Biden.”

— Nihara Lijan

“I think gas prices have more to do with natural resource availability than President Biden,” Lijan attests. “Prices are rising because there is a reduction of gasoline around the world, not just because of the President’s leadership.”

The current national average of gasoline is over $4 per gallon, and prices are continuing to rise. While they will inevitably drop once the world reestablishes order and normalcy, only time will tell when.