AAA: Gas Prices Soar in Kentucky; National Average Highest Since 2014

Gas prices in West Central Kentucky are 10 cents higher this week at $3.093, according to AAA East Central’s Gas Price Report.

This week’s average prices: Western Central KY Average                $3.093
Average price during the week of January 31, 2022                           $2.997
Average price during the week of February 8, 2021                           $2.294 

Average prices of unleaded self-serve gasoline in various areas: 

$3.148        Bowling Green
$3.076        Elizabethtown
$3.335        Louisville
$2.945        Owensboro
$2.961        Paducah

Trend Analysis:

Blustery winter weather and geopolitical tensions are helping to drive the price of oil higher, which is in the low-$90s per barrel, nearly $30 more than in August. The recent cold weather in the U.S increased the demand for heating oil. Meanwhile, the concern that Russia will react to potential western sanctions by withholding crude oil from the already tight global market puts heavy upward pressure on prices. The national average for a gallon of gas has surged to $3.44, eight cents more than a week ago. Gas was last this expensive in 2014.

According to new data from the Energy Information Administration (EIA), total domestic gasoline stocks grew by 2.1 million barrels to 250 million barrels last week. However, gasoline demand dropped from 8.51 million barrels per day to 8.23 million barrels per day. Usually, an increase in total stocks and a decrease in demand puts downward pressure on pump prices, but the rising cost of oil continues to push prices higher. If crude prices continue to climb, pump prices will likely follow suit.

At the close of Friday’s formal trading session, West Texas Intermediate increased by $2.04 to settle at $92.31. Additionally, EIA reported that total domestic crude stocks decreased by 1.1 million barrels to 415.1 million barrels. The current stock level is approximately 13 percent lower than at the end of January 2021, contributing to pressure on domestic crude prices.

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