Consumers line up for cheap gas at Costco
The national average for gas was $4.32 on Monday, up 13 cents from the week before: AAA
Consumers have been turning to Costco and other discount retailers for cheaper gas as inflation sits at 40-year highs, with the price of everything, including energy soaring.
Costco Wholesale sells gasoline for less to members. In fact, the Oil Price Information Service (OPIS) conducted a survey in 2017 and found that Costco regularly delivered cheaper gas compared to every major gas chain.
Other retailers are trying to help their customer base deal with surging gas prices as well. Late last month, Walmart announced its Walmart+ customers will get a discount of up to 10 cents on every gallon of fuel they purchase at more than 14,000 participating gas stations around the country.
The national average for gas was near record highs sitting at $4.32 on Monday, an increase of 13 cents from week before and 21 cents from the month before, according to AAA. The association noted that the national average is currently $1.37 higher compared to the same time last year.
Only eight states had an average under $4 a gallon as of Monday, according to AAA, which noted that increasing gas demand and rising oil prices have pushed prices at the pump higher.
Gas prices are expected to face upward pressure as oil prices remain above $105 per barrel.
Crude prices rose after the European Union announced a proposal to ban Russian oil imports within six months, while refined product imports would be prohibited by the end of this year, AAA noted, pointing out that it’s not clear if the plan will be approved as some members, including Slovakia, said they need more time to find alternatives to Russian oil.
On Monday, oil prices fell, with West Texas Intermediate futures, the U.S. benchmark, trading at around $107 a barrel and Brent crude futures, the international benchmark, trading at about $110 per barrel.
|USO||UNITED STATES OIL FUND L.P.||62.55||+1.92||+3.17%|
|BNO||UNITED STS BRENT OIL FD LP UNIT||25.02||+0.64||+2.60%|
In an interview that aired on "Mornings with Maria" on Monday, Lipow Oil Associates President Andy Lipow acknowledged that the government has taken some steps to control the rising gas prices, but argued that more needs to be done to help increase domestic production.
BIDEN ADMINISTRATION TO RELEASE 1M BARRELS OF OIL DAILY FROM US RESERVES
The oil analyst also noted that private drillers have been stepping up amid the soaring energy prices.
"They’ve [the Biden administration has] done little to get more oil out of the ground," Lipow said. "However, the industry is responding and the drilling rig count has now exceeded 700 rigs, which is up about 60% compared to this time last year."
Last month, Lipow told "Mornings with Maria" that he expects gas prices will rise another 10 to 15 cents per gallon amid fear over tight global supply growth.
Inflation accelerated to a new four-decade high in March and price hikes were widespread with energy prices rising a staggering 11% in March from the previous month, and are up 32% from last year.
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Gasoline, on average, costs 48% more than it did last year after rising 18.3% in March on a monthly basis as the Russian war in Ukraine fueled a rapid increase in oil prices.
Last month, the Labor Department said that the consumer price index (CPI) – which measures a bevy of goods including gasoline, health care, groceries and rents – rose 8.5% in March from a year ago, the fastest pace since December 1981, when inflation hit 8.9%. Prices jumped 1.2% in the one-month period from February, the largest month-to-month jump since 2005.
The inflation data for April will be released on Wednesday.
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