Gas prices are always a hot topic of discussion and for a good reason. Why is gas so expensive in the United States? And what effects does this have on our economy? In this article, we will explore these questions and more. We will look at how gas prices are determined and examine some factors that contribute to their volatility.
Why Is Gas So Expensive In The United States?
The price of gasoline is determined by a number of factors, including crude oil prices, refining costs, taxes, and market demand. Crude oil is the biggest contributor to the price of gas. The cost of crude oil makes up about 60-70% of the price of a gallon of gas. Refining costs make up another 15-20%, while taxes and market demand account for the remaining 20-30%.
There are a number of reasons why crude oil prices are so volatile. One is that there is a limited supply of crude oil in the world. This means that any changes in production can have a big effect on prices. Additionally, political instability in countries where crude oil is produced can also lead to higher prices.
The conflict in Ukraine is the key driver behind the current high price of fuel. The markets for oil and natural gas throughout the world are significantly impacted by Russia’s participation. The number of countries that are able to export these resources has decreased as a result of sanctions imposed by several western nations, which hinder western nations from engaging in commerce with Russia’s resources.
Russia is the third largest supplier of oil in the world, after the U.S. and Saudi Arabia. It produces 12% of the world’s oil supply, including 8% of the US’s supply.
How Do High Gas Prices Affect The Economy?
Americans are seeing an instant impact at the pump as a direct result of prices reaching all-time highs. However, increasing gasoline prices constitute a negative for the economy as a whole, rather than merely causing people to have less money available for expenditure. Everything that is delivered by truck, train, or ship will be more expensive as a result of the growing cost of fuel, especially diesel.
It is possible that families may experience a drop in income, employment, and returns to components that are utilized for production as a result of a rise in the fuel levy. When production is taken into consideration, businesses are impacted by fluctuations in fuel prices due to the fact that the costs of their inputs depend on transportation and some petroleum products.
Ways To Save Money On Gas During The Summer Travel Season
Fill Up On Mondays
According to findings from a study conducted by GasBuddy in February 2022, the cost of gasoline is lowest on Mondays throughout the majority of the United States, while prices are highest on Wednesdays, Thursdays, and Saturdays.
Buy Gas With A Rewards Credit Card
Using a credit card in a responsible manner might earn you points at the petrol station. Some credit cards have particular spending categories that yield a higher proportion of rewards than others, and one of these categories is petrol.
Always be sure to pay off the whole balance on your credit card at the end of each month to prevent incurring any additional expenses for interest.
Utilize The Loyalty Programs Provided By Local Grocery Stores
A great number of grocery store brands offer customer loyalty programmes that award points redeemable for petrol rewards. Kroger’s fuel points programme delivers one fuel point for every $1 spent at Kroger supermarkets.
At eligible Shell stations, one hundred fuel points may be redeemed for ten cents off each gallon, however, the highest redemption value is found when purchasing petrol at Kroger gas stations, where one can redeem up to one dollar off per gallon for one thousand fuel points.
There is no cap on the number of fuel points that may be gained in a given month; however, fuel points become invalid on the last day of the month following the month in which they were obtained, so it is important to make use of them on a regular basis to get the most out of your discount.
Enroll In Gas Rewards Programs
Those who have a preferred chain of gas stations may find participating in the rewards program offered by that chain to be beneficial. These programs provide savings at each fill-up as an incentive for loyal customers as a way to thank them for their continued business.
When you purchase fuel with your Exxon Mobil Rewards+ card, you will get three points per gallon, and you will earn two points for every dollar spent at convenience shops and vehicle washes. Your total discount will be reduced by $1 for every 100 points that you redeem, up to a maximum of 5,000 points that can be redeemed all at once for a total savings of $50.
Use Gas Apps To Find Cheap Gas Near You
There are a few handy applications that can display the locations of gas stations near you along with the current costs of petrol at those stations. For instance, the GasBuddy app enables users to keep track of local gas prices and permits searches based on the user’s current location, ZIP code, or city.
GasBuddy customers are eligible for a free rewards card that may be used to receive savings at participating gas stations. The card is mailed to the customer and connects immediately to the checking account.
According to the website of GasBuddy, customers may save up to 25 cents per gallon at the pump by swiping their rewards card and pumping their petrol at the same time. According to USA Today, GasBuddy earns money by selling user data preferences to station owners. This provides the company with a revenue stream.