Why Gas Prices Are Up--And Why They Might Go Higher
Gas prices are on the rise again--the average retail gasoline price recently jumped twenty cents to $2.55 a gallon. A panel of experts joined Bill Griffeth on "Power Lunch" to talk about rising prices--and the factors leading to increases.
“This is a time when it is most dangerous for refineries. Now is when they’re restarting refineries and shutting them down. This is when supplies are the tightest and we feel it the most when it happens,” said Phil Flynn, senior market analyst at Alaron Trading. Prices are at their highest since September of 2006.
According to Tracy Lundberg, president of Lundberg Survey, daylight savings time can also boost gas prices. “It can potentially add, we think, as much as 1% to the demand, and it’s earlier than usual this year. That hour of daylight adds some safety and convenience for a lot of motorists,” Lundberg said.
Tyson Slocum, energy program director at Public Citizen, cited two reasons for the increase in gas prices. “We have allowed so many mergers in the downstream industry that our domestic markets are uncompetitive," he said, pointing to consolidation in the refining sector in particular. Slocum added that energy trading markets are nontransparent and lack government oversight.