According to one energy expert, high gasoline costs are already affecting demand.
“When gas prices reach $4 per gallon, the American people begins to adjust their driving patterns. And we are witnessing demand destruction on a daily basis “KPMG’s global head of energy, Regina Mayor, told Editorials99 Finance Live.
“I think that’s one of the factors that improves the general tightness of supply,” she added.
Since the start of the Russia-Ukraine conflict, the price of US West Texas intermediate (CL=F) and Brent (BZ=F) has swung dramatically. Russia, a major crude exporter, has been sanctioned by Western nations. The United States and the United Kingdom have also imposed a restriction on Russian oil imports.
The national average price of gasoline is currently $4.24 a gallon. As we approach the summer driving season, the mayor anticipates costs to remain high for some time.
“Summer vacations are upon us. Because of the pandemic’s pent-up demand, the tourism industry anticipates more airline activity. And this is the time of year when petrol prices are usually higher “Mayor remarked.
“The price of crude oil is at an all-time high. So, unfortunately, I believe that customers will continue to pay exorbitant gas costs in the near future “she stated
WTI futures were down more than 1% on Tuesday, holding just above $110 per barrel. Brent crude fell marginally as well, and now trades at $114 per barrel.