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Why are gas prices really so high?

California moves to end sales of new gas-powered cars by 2035
Posted at 11:04 AM, Apr 06, 2021
and last updated 2021-04-07 07:41:35-04

PUEBLO — In both Pueblo and El Paso counties, it's nearly impossible to find a gas station posting a price less than $2.89 a gallon for regular unleaded.

Countrywide, confusion is circulating about why gas prices seem to have skyrocketed out of nowhere. Many people's fingers, and social media posts, are pointing at the recent Presidential election.

So, what is really the driver behind high gas prices? The answer is - A lot of things.

Here's the breakdown:

  1. Coronavirus - The pandemic has impacted every single industry, oil and gas is no exception. Federal data shows that in April 2020, just after COVID-19 took the country by storm, the average price of gas was $1.938 Dollars per Gallon in the United States. Now, as restrictions loosen and vaccines roll out, the demand for gas increases with people traveling. According to AAA's data, the average cost per gallon today in El Paso county is $2.897 and Pueblo County is $2.987.
  2. That Winter Storm in Texas - Roughly a dozen refiners were impacted in Texas during the brutal winter storm that hit earlier this year. Refinery Utilization in the country was previously at 83%, but after the storm, dropped to 56%. This means less crude oil being refined, inherently causing less gasoline.
  3. The Election Results - Although the Keystone XL pipeline does not immediately impact the supply and demand issue, President Joe Biden's decision to halt construction on the project does provide the implication that the administration will restrict oil production in the United States. The Biden administration is vocal about the prioritization of the environment and decreasing emissions. However, the less the U.S. produces oil - The more expensive it becomes.
  4. OPEC Production - Last year, OPEC+ chose to reduce oil supply as a result of tanking demand during the pandemic. Now that the economy and public are beginning to recover from COVID-19, OPEC is choosing to keep production relatively steady, instead of increasing supply to meet the newfound demand.
  5. Summertime - Every year, refiners have to produce "Summer Blends" of gasoline that are required by the U.S. Environmental Protect Agency. These blends are more expensive than those produced in the winter, and demand for gas is inevitably higher during the summer due to travel (especially this summer per point #1).
According to AAA, Colorado's Average Retail Price of gas in between $3.064 to $2.842 per gallon as of April 2021.
Federal data tracking gas prices per gallon from 1994 to 2020.

How have people in Pueblo County been handling these sticker-shock inducing gas prices? News5 will have more on tonight's shows at 4:00 pm and 5:00 pm.