Tuesday, November 16, 2021

CNBC explains 'Why Gas Prices In The U.S. Vary'

I used to be all over gasoline prices on this blog, but then gas prices fell and I moved away from the corner gas station. Consequently, I no longer saw changes in gas prices in my neighborhood (the closest gas stations are now a mile away, instead of around the corner) and moved on to other subjects. Now that gas prices are rising during the time of year when they should be falling, I'm returning to the topic with CNBC explaining Why Gas Prices In The U.S. Vary

As of October 4, 2021, the average price for a gallon of gasoline in the United States reached about $3.19. A closer look at the costs of a single gallon of fuel can be even more revealing. The refinery count in the United States has shrunk dramatically over the last several decades. That means the country relies on an ever-smaller number of ever-larger plants and is more vulnerable to supply constraints in the wake of outages.
That's a very good explanation of why gas prices are different from state to state and region to region in the U.S., although it captures only part of the reason. The other is increased demand in the face of lower supply, something I've worried about for a while, most recently in Oil falls below $0.00 for the first time ever, when I wrote "the collapse in oil prices will lead to oil company bankruptcies, which will decrease competition and lead to higher prices in the future." Those higher prices because of decreased competition and restrained supply have arrived and I think they will last at least until next year.  Get used to them.


  1. $4.35 at the 'cheap' station here in Rosamond.

    1. My daughter was complaining about $6 a gallon gas in Hollywood. She decided to buy an all-electric car.