As you’ve probably noticed, the cost of oil is rising, which means gas prices are going up. In fact, they’ve been going up six out of the past seven weeks, with the price of oil costing 75% more than it did in February.
But why is this happening?
The short answer is because of a threat to the supply. Each time the oil supply is threatened, demand goes up and so does the cost. Right now, Canada, Venezuela, Nigeria, and other oil-producing countries are experiencing outages and supply disruptions, which means we’re short on oil and in return, the market cost is increasing. This cause and effect is so fast, it happens almost instantaneously. According to Fox Business, every $1 increase per barrel of crude oil means a $2.38 increase at the gas pump.
However, there’s still good news for travelers who plan on taking a road trip this summer. Even though gas prices are going up, they still won’t reach the prices they were at last summer. Last summer, the average price of gas was $2.75, a good 50 cents more than the average is projected to be this year.
And when it comes to flying, you won’t have to worry too much either. While a spike in oil prices can quickly affect gasoline prices, it’s much slower to affect airline fuel prices (which are the majority of the price of your flight). Oil prices would have to stay elevated for several months, then you may start to see an increase in flight prices. But otherwise, summer travel is looking pretty good for flyers – especially since airfares are at their lowest in nine years.