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Gas prices surge, increase likely to continue - KOAA.com | Continuous News | Colorado Springs and Pueblo

Gas prices surge, increase likely to continue

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Mid-May gas prices are at their highest levels since 2014 across the country and in southern Colorado amid increased demand, political unrest in the Middle East, and the annual switch to the more expensive summer fuel blend.  According to gasbuddy.com, the May 14 nationwide average price for a gallon of regular unleaded fuel is $2.88.  The statewide average for Colorado is cheaper at $2.80, and Colorado Springs cheaper yet at $2.71.  Still, AAA Colorado predicts prices to climb above $3.00 per gallon in time for the peak summer travel season, which begins in earnest Memorial Day weekend.

"Gas always spikes this time of year as we look toward summer driving season, but it doesn't always spike like this," said AAA Colorado spokesman Skyler McKinney.  Colorado prices are up 9 cents in the past week and 15 cents since April.  McKinney says most of the reason for the price increase is a surge in demand.  "We're victims of our own success right now," McKinney said.  "The reason that gas prices are so high is that consumer confidence is high.  People are spending more money, they feel good about their paychecks, they're more willing to take road trips."  McKinney says April 2018 was the highest-demand month of April since AAA started tracking that category.

There are other factors affecting prices.  Instability in the U.S./Iran relationship is creating uncertainty that is driving up the price of crude oil.  "In the United States, we don't get a ton of oil from Iran, even though Iran is a major oil-producing country, but the uncertainty about what's going to go on with the sanctions is driving crude oil prices up," McKinney said.  Fluctuations in crude oil prices are generally felt at gas pumps a couple weeks later.  The most uncertain factor in price fluctuations is the weather.  "If there's a major hurricane season again, we're talking probably 10, 15, 20, 25-cent increases," McKinley said.

Overall, AAA Colorado anticipates the average per-gallon price in Colorado to remain relatively steady between $3.05 and $3.20 for the peak demand period this summer, barring any unanticipated political or natural influences on supply in the Middle East or Gulf of Mexico.  "We're not talking the era of $4.00 per gallon gas prices," McKinney said.

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