Brent Crude futures made the largest jump ever recorded Saturday following the strikes, during a time gas prices would usually be declining because of a switch to winter blend gasoline that’s cheaper to produce and a post-summer demand decline.
How long the price spikes will last is unknown, but AAA National anticipates the national average could reach $2.75 this month. Motorists are likely to see price increases vary — anywhere from 5 to 20 cents — by region and market.
For example, gas stations in parts of Kentucky were selling gas for $2.19 per gallon Tuesday.
The timeline for Saudi Arabian facilities to resume normal operations remains fluid. During a press conference this week, Saudi Arabia’s energy minister said half of the oil production that was lost has been restored and normal production would resume by the end of September. If this proves true, any price spikes being realized now will be short-term, according to the AAA.
W. Rocky Newman, professor of management at Miami University, called the spike “a 12- or 13-day hiccup.” He expects prices to return to normal by early October.
He said the oil supply chain is “very, very lean” so any disruption causes a spike in prices.
U.S. dependence on Saudi Arabian crude imports has decreased in the past decade. In the first half of the year, on average, the U.S. imported about half the amount it did in the first half of 2017.
“The strike removed out of the global oil market 5 to 6 million barrels of oil daily … which is quite big and significant,” said Riad Ajami, an oil expert and international business and global strategy professor at Wright State University.
“Trucking companies, airlines, consumers, farmers who are using petro-chemicals … are all going to be thinking will my next load cost me more, will my next attempt at the gasoline pump cost me more?”
Truck driving companies typically buy fuel in bulk once a week, said Bob Lairson, owner of Lairson Trucking Co. in New Miami for 36 years. He won’t know how much the spike will cost him until he gets this week’s bill.
“It’s never a good sign when gas goes up,” he said.
He said trucking companies have agreements that their clients will cover a fuel surcharge. That increase is passed along to the consumer, he said.
“If it’s on a truck, and everything is, you can expect it to cost more,” Lairson said.
AREA GAS PRICES WEDNESDAY
$2.55: Verity Fuel, Verity Parkway, Middletown
$2.85: Speedway, Roosevelt Boulevard, Middletown
$2.85: Shell, Breiel Boulevard, Middletown
$2.85: Shell, Ohio 63, Monroe
$2.85: Speedway, New Garver Road and Ohio 63, Monroe
$2.85: Monroe IGA Express, Ohio 63 and Main Street, Monroe
$2.85: BP, Ohio 4 and Ohio 129, Hamilton
$2.85: Certified, High Street, Hamilton
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