The national average price for a gallon of gasoline has topped $4 as the federal government struggles to rein in the price of crude oil.
According to AAA, the national average as of Sunday stood $4.009 per gallon of regular. This compares with $3.922 per gallon a day earlier and $3.604 per gallon a week earlier. A month ago, a gallon of regular cost $3.439 on average.
CNBC noted in a report on gas price movements that this is the highest since 2008 and cited Andrew Lipow from Lipow and Associates as saying prices had higher to go.
"Oil buyers are reducing their purchases of refined products from Russia, causing Russian refineries to shut down," Lipow told CNBC. "Dockworkers are refusing to unload vessels carrying oil and gas. Insurance rates are skyrocketing, causing vessel owners to cancel ship bookings loading in Russia, and this is also impacting on the ability of Kazakhstan to sell their oil."
In response to these developments, the United States has so far negotiated a release of 60 million barrels from several countries, coordinated by the International Energy Agency. It has also sent envoys to Riyadh, but it seems that OPEC's de facto leader is not too willing to boost oil production without getting anything in exchange, per an interview with Crown Prince Mohammed bin Salman.
Meanwhile, the U.S. is discussing an official ban on Russian oil imports with its allies in Europe. With traders already shunning Russian oil cargos because of Western sanctions and ports refusing to accept Russian vessels, the official move to sanction Russian oil would be a continuation of a process already set in motion by previous sanctions.
The U.S. is looking for alternatives, it seems, sending a group of officials to Caracas for talks with the Maduro government. According to reports, the talks, which focused on the possibility of easing U.S. sanctions on the country's oil industry, ended with no agreement between the sides.
By Charles Kennedy for Oilprice.com
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