Gasoline prices in the United States witnessed an unexpected spike, taking some of the fun out of summer. AAA called it the steepest one-month climb in the gas prices since they started recording in 2000. The national average price for a gallon of gas has climbed to $3.67, a 34 cents rise in the prices from the last month's $3.38. Industry analysts blamed sudden rise in fuel prices as one root cause of the increase in gasoline prices. Other factors also contributed to the rising prices of fuel including problems with West Coast's refineries and pipelines, two offline plants in the Midwest and problems in the Richmond plant damaged by fire in California.
Analysts didn't expect gasoline prices to rise as they did in April, when the average of United States topped at $3.94. But this still is unwelcome news in the sluggish economy, since price hike means lost profits, lost income and lost savings. The spiking prices could also put some pressure on President Barack Obama during his re-election campaign. Economists and Analysts agreed that wholesale gasoline and crude oil prices are set on financial exchanges throughout the world that is based on supply and demand and expectations on how to change those factors.
Patrick DeHaan, senior petroleum analyst for GasBuddy explained the reasons for rising gas prices as new pipeline glitches and spike in ethanol prices. He commented that prices of ethanol may continue to rise for at least next two months which will eventually affect the prices of gasoline. He further said that gas prices will continue to rise unless U.S. expands its existing refineries or builds new ones. He added that the operating refineries need to function better as they constantly seem to be breaking down and prices will remain high as long as this refining cannot be tackled.
Analysts expected the gas prices to drop as the Labor Day approaches or the prices may start falling at the end of Christmas, despite the 19 percent spike in the past two months. But the recent rise in gas prices isn't stopping the Americans to get out of town and hit the roadways during the long weekend.