Cars, Personal Finance, Saving Money

So Much for Steady US Gas Prices. Expect Spike Due to Iraq Oil Troubles

Expect rising oil and gas prices due to continued unrest in Iraq
It’s amazing what a couple of weeks, and unrest in an oil producing part of the world, can do. At the beginning of the month, AAA predicted gasoline prices, while high, would remain fairly steady through the month, with a possible slight rise as we headed into the fourth of July weekend. In their words, “AAA predicts the national average price of gas this summer likely will vary from $3.55 – $3.70 per gallon.” They did add a caveat in the next sentence, and one which seems to be quite accurate with the current geopolitical situation in Iraq. The sentence they added was, “Major refinery disruptions, geopolitical concerns or a damaging hurricane season could send prices higher than forecast.”

A barrel of crude oil is now the highest it has been all year, and continued unrest and uncertainty in Iraq has it poised to go even higher. While the unrest hasn’t had an effect on Iraq’s oil production in the south thus far (attacks from insurgents in the north had already shut off experts from the northern oil fields), the higher prices continue to be driven by the fear Iraq’s oil exports in the south could take a hit later this year during peak world oil demand.

What does all this mean for those of us living in the US? Get ready to see a spike begin this week at gas stations and last as long as the unrest in Iraq keeps oil traders nervous. Record high gas prices have already hit England and parts of Canada in the last 24 hours, and while we may not hit record prices in the US, they are likely to be a lot more per gallon next week than they are this week. You can look for them to start heading toward $4 a gallon (the current average price for gas in the US is $3.66) as we approach July 4.

For many, that means going into gas saving mode to try and take some of the sting out of the higher prices. By far the best way to reduce the amount spent on gas is to use your car less. This isn’t always possible, but the less you can drive, the more you’ll save on gas. Below are five tips than can possibly help you reduce the amount you drive, and thus the amount you spend on gas:

  • Use alternative methods to get where you’re going if the distance isn’t too far away such as walking or biking.
  • Plan and combine trips so that you only go out once a day to get all your shopping and errands done, rather than several trips throughout the day.
  • Plan weekend activities closer to home rather than to places which require a long drive.
  • Consider carpooling, public transportation or ride sharing as an alternative to driving yourself to work each day.
  • Plan a summer staycation. Instead of taking a summer trip out of town, explore all the areas near you which you’ve wanted to see, but never have found the time to do so.If reducing the amount you drive isn’t possible, head to the least expensive gas station in your area and fill up. It’s almost guaranteed that the price will be a lot higher next week than it is today.

3 thoughts on “So Much for Steady US Gas Prices. Expect Spike Due to Iraq Oil Troubles

  1. I may just have to get rid of my car if gas prices continue to climb. I hate having to pay so much for gas.

  2. Why should our prices surge like that when we barely get ANY crude oil from that region? This Gas pricing crap is ridiculous!!

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