Why Are Gas Prices Going Up

Why Are Gas Prices Going Up Again?

The prices of gasoline have always been known to fluctuate up and down and sometimes they reach extreme highs.

When are gas prices going up again?  Great question but,it certainly is a pain in your wallet to fill up at the gas pump. Most people do not know or understand the why is the price of gas going up?  They often go up quickly within the time frame of a few weeks. About 70% of the actual price of gas is dictated by the cost of crude oil at that time and the remaining 30% of the price is a direct result of the other processes the gas goes through, from the refineries to distribution.

The gas market is regulated by supply and demand like many other markets and the price at the pump reflect this. Oil companies bid higher for crude oil when they feel it would be more valuable and these higher purchase prices, leads to higher resale prices and the consumer at the gas station ends up coughing up the extra dollars the oil companies bid.

During this time of the year (spring) there usually is a rise in gas prices because of the surge in demand for gas during the summer months. This means that the oil companies are going to bid higher prices for gas and over the span of a few weeks we begin to see a surge in prices at the pump.  This is a big reason why is gas going up.

Although this is the more steady reason why gas prices increase, there has been other reasons for the sudden increases in gas prices in recent years.

·         Oil Pipeline damage or shut down

A lot of times when disaster hits and such events reduce the supply chain and makes gas prices go up as a result of the decreased supply. Pipelines are often shut down for regular seasonal maintenance and if not adequately accounted for this could also be why is gas going up again in the following weeks.

·         Military events

In the event of military actions or drills being taken by the armed forced. There is a lot of uncertainty or tension that can cause the price of oil to go up. This depends greatly on the scale of the action is usually significant only in extreme cases.

There are numerous different reasons why is gas going up the way they do and it all boils down to a game of supply and demand. The usual trend sees it increase around the peak driving spring and summer months and decrease slightly the following winter, but sometimes geopolitical action or natural disasters could also be factors.  While we can have a good idea when are gas prices going up again, we just don't know how much.

So the biggest question shouldn't really be why is gas going up, but what are you going to do about it?  Learn how you can save $0.40 to $0.90 per gallon of gas with Fuel Direct.

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