Gas Prices Continue to Soar in Montana and Across the Nation
Montana gas prices have risen three cents per gallon in the past week, averaging $3.41 per gallon today. Patrick DeHann is the head of petroleum analysis at GasBuddy and he said the national average increased as well.
“The national average jumped about four cents per gallon in the last week and this all comes as the price of oil continues to advance,” DeHaan said. “Oil prices are a little higher today. They are at about $84 per barrel, but that has been the reason for the fairly fast and furious increases over the past three weeks as oil prices took a big jump on word of a global energy crunch overseas that is boosting demand.”
According to DeHaan, the Organization of the Petroleum Exporting Countries is in no rush to increase production.
“OPEC has been fairly slow to increase production given that global demand is lurching higher,” DeHaan said. “It doesn’t look like production of crude oil will increase at a faster rate, which would also help to bring down prices. I think, for now, motorists should be resigned to having to dig deeper as we approach the holiday season with gas prices more likely to be higher by the end of the year than lower.”
"I think, for now, motorists should be resigned to having to dig deeper as we approach the holiday season with gas prices more likely to be higher by the end of the year than lower."
DeHaan said oil prices could rise again at any time because the supply chain is very inconsistent right now.
“It is not just gasoline,” DeHaan said. “The price of diesel is about 20 cents a gallon higher than gasoline and continues to surge amidst some of these supply chain slowdowns. I think those have been the catalyst for some of the problems with energy overseas and China not having enough coal to feed its power plants. I think we need some sort of resolution there as well and I don’t see a whole lot of improvement coming immediately. I think in the months ahead the situation will eventually improve, especially after the holidays, but for now we are stuck with this very fickle and delicate supply chain.”
It appears that the Biden administration and OPEC are not on the same page. DeHaan said that tug of war could also impact prices at the pump.
“The Biden administration has made it clear that they are going to transition the U.S. away from oil,” DeHaan said. “This potentially could be a very stubborn OPEC that sees the shelf life of oil dramatically reduced because of the president’s willingness to move the U.S. off of fossil fuels. This could be an indirect attack on OPEC and OPEC may be reluctant to help lower prices given that the policies of the Biden administration are in conflict with their primary market and their primary product, which is crude oil.”
The national average is up 17.1 cents per gallon from a month ago and stands $1.21 per gallon higher than a year ago.