With uncertainty over the Iran conflict, who knows what gasoline prices will be next week or next month. The recent rise at the pump brings to mind when oil rose to $147 in 2008 or, for those old enough, the prolonged high prices and shortages in the 1970s.
A dynamic change over the last 15 years likely means this global disruption could be different than in past years for the U.S., relative to the rest of the world. Then, a large majority of oil consumed in the U.S. was imported, much of it from the Middle East. Not today.
Because U.S. independent oil companies discovered how to unlock oil bound in shale rock formations, U.S. oil production went from 5 million barrels per day in 2008 to over 13 million barrels per day currently. Consequently, oil imports are 75% lower. See chart below.
The impact of growth in U.S. oil production is seen today in market price differences. The U.S.-based market (WTI) was trading Friday around $98/barrel while the global-based market (Brent) was trading around $113/barrel. As of Monday morning, markets had calmed down some with lower oil prices.
Despite oil being a global commodity, proximity to production and refining capacity is among the biggest factors impacting fuel prices. Looking around the U.S. and the world, fuel prices are highest in the places most dependent on imports (state/national tax rates matter too).
Here are gasoline prices in a sample of locations as of Monday:
Mississippi - $3.55/gallon
California - $5.79 (partially dependent on fuel imports from east Asia)
Oklahoma - $3.25 (lowest in U.S.)
Arizona - $4.54
Illinois - $4.17
U.S. Average - $4.07
Hong Kong - $15.01 (highest in the world)
Germany - $8.87
Australia - $5.56
Saudi Arabia - $2.39
China - $4.51
Mexico - $5.66
The moral to the story is, energy follows basic economics - supply goes up then price goes down; supply goes down then price goes up.
Those places with the most exorbitant fuel prices and experiencing actual supply disruptions are typically further from or have cut off supply sources. Comparing global energy prices today is a good reminder - the best energy is locally-produced energy that's available.
Patrick Sullivan authored this post. He is President of the Mississippi Energy Institute.
This post is a paid advertisement.
33 comments:
Gas prices are only part of it. Several GCC nations produce precurser chemicals for fertilzer as well as gasses used in high tech manufacturing. GCC states they are looking at minimum 5-8 months rebuilding, a year or more to return to normal production. The US may not be affected but there is a high probability of global famine as more than 1/3rd of the emerging economies rely on cheap precursers for affordable fertilizers to grow crops. And these arent nations full of fatties like America. These are people already struggling to meat their daily nutrition needs. Not a lot of Good will remaining in these places towards Trump and Israel. It will be worse if people are watching their loved ones die because of Operation Epic Fail. Maybe the US government can print more money and provide food aid to them like they will be give billions to Israel to pay for them to rebuild their cities and military?
Trump declared that Iran will not build nukes & so Trump said he will quit bombing them..
Oil down $10.00 dollar this evening $89.00 a barrel
Elections have consequences.
Most who follow this blog can probably afford the increase, but some households cannot and must give up or cut other spending drastically. Sadly, gasoline prices may be the least of our worries and Trump's war may create the first battle on our American soil since the Civil War.
I work from home, and everything I need (walmart, kroger, home depot) is within 2 miles of me, and everything else I order on Amazon.
Despite this we still have to deal with a $1.00 increase . This problem and all the others Trump has created will have to be solved by the next administration . Anybody hear what’s in the “Project 2029”! I would think the Republicans would be working on one, The Democrats surely have theirs .
Good for you. But you are 1/300 million.
Do you see a definite and specific time when I should wake up and watch the sky fall, or are you keeping that secret?
Get help soon. The syndrome is now a disorder and is eating you alive.
If this will cause more people to stay at home and stop going clubbing, well...
Reply to March 23, 2026 at 3:54 PM
Alaska was invaded by the Japss inn WW2 in the Aleutian Island.
When fuel costs rise it doesn’t just hit transportation it raises the price of moving everything across the country. Higher fuel costs gets rolled into groceries, materials, and everyday goods whether you realize it or not. Add in these tariffs and extra costs on top of an already expensive economy. At some point someone with a brain has to realize regular people not politicians are the ones paying the bill.
More than 70% of U.S. refining capacity is set up for heavy crude, which is not produced by shale fields, so please spare me the supply and demand BS.
https://www.reuters.com/business/energy/us-refiners-unlikely-spend-big-process-more-domestic-oil-2025-04-09/
That said, I'm willing to pay whatever it costs to pay for the fight against Revolutionary Guard terrorists, and to keep terrorists in Iran from getting nukes.
What year did Alaska officially become a state? I am pretty sure it was a decade after WW2. But I probably know history better than you because I watch Tucker
Facts & Honesty
Well, prices might be going up but there are no shortages for us, a big change from the 70's. Gas lines, embargoes, shortages, rationing, every other day..
@4:15pm - How do I join the cult?
How soon we forget. Nowhere near the Bidenflation prices during the summer of '22.
@6:36pm - Which was caused by the Covid money printing started by Trump and continued by Biden.
Thank you!! Some people (liberals) have such short memories.
KF you are right n the 70’s there was rationing in states with only being able to fill up on even or odd days, unless you could prove an emergency. As for not being able to fill liquor stores, you think it’s possible God heard the prayers of believers. For those who have been hurt by drunk drivers or killed & now add medical weed to the equation auto insurance has gone up also. We still live in the Greatest Country in the World with the best Law Enforcement.
Operation Epic Fail contibues as Trump claims a 5 day cease fire that isninterrupted by Israel striking Isvahan gas transfer facility to intentionally end the cease fire and force TACO’s hand.
In other news, an explosion at the Port Arthur refinery in Texas send Oil futures soaring.
Trumpstein is truly unable to lead and Israel definately seems to be running this “war”
which appeara to have no offramp.
@4:55, @3:54 said " Trump's war may create the first battle on our American soil ". FYI, The Territory of Alaska was an organized incorporated territory of the United States from August 24, 1912. So you are incorrect as the OP said "American soil" not American state. Reading is fundamental.
There is a refinery on fire in Texas.
How does Trump expect to demolish Iranian extremists by reversing sanctions on their oil? He just boosted Iran's economy by about $14B. Meanwhile, Russia is raking in the dough, thanks to Trump's failure to maintain sanctions on their oil.
He's TACO'ing, folks. We've seen it many times before.
The cost of diesel has gone up more than gasoline. To paraphrase Trump, you truckers just need to make do with two dolls.
My plane ticket went up in price while I was booking it and made me reconfirm the new higher cost before purchasing today.
Thank God its work travel.
KF, the reasons the gas prices went up so high were: The Iran Revolution in 1979 followed by an Arab oil embargo (do we really think religion won't become a factor for Arab leaders who hope to retain power? You don't think Saudi Arabia being hit wasn't a wakeup call to "pick sides" and don't pick the U.S. ?) And, later the Iraq war contributed. They went up 4% in 1979 quickly like now and never came down to that price again. Did we forget Iran has oil? This time, oil fields are being bombed in the region, and the Strait of Hormuz is blocked. And, last time, we had ALLIES and ship lanes and still it was bad. I sure don't want us to deplete another generation of fine young men again.
Did I say they did NOT go up back then? I said there were shortages in the USA. There are no shortages now as our supply is plentiful. You are also conveniently leaving out a little fact. The prices DID come down, much to your chagrin, thanks to Reagan. Reagan deregulated the oil industry. Price controls were no more. Once prices rose, as they do when price controls end, it was profitable for oil companies to explore and drill, which they did. Then the prices came back down.
Of course, you probably forgot that Reagan's deregulation produced an oil GLUT and oil came down to $8 a barrel. Crashed the Louisiana and Texas economies. but I'm sure you knew that, right?
CNBC Finance 12:27 PM EDT: JPMorgan Chase CEO Jamie Dimon said the Iran war is risky in the short run but could improve the odds of a lasting Middle East peace.
Dimon tied the peace calculus directly to economics, arguing that foreign direct investment flowing into the region will stall without stability.
Speaking with Palantir executive Mike Gallagher at a Washington, D.C., conference, Dimon said the regional attitude toward peace has fundamentally shifted from 20 years ago: “They all want it.”
Dimon being no friend to Trump makes these comments extremely interesting.
If the Iran “war” does end up making the world a better place, will we need to exponentially increase production anti-depressants for all of the Democrats and RINO’s rooting for our country’s failure due to their hatred of Trump (TDS)? Probably not since the armchair opinion providers will move on to their next, they hate Trump topic.
@1:54pm - Nice copypasta. No one cares what Jamie Dimon has to say about anything.
@Kingfish - Trump ain’t no Reagan, nowhere close. And let’s not get into the whole Iran Contra affair since you want to gargle his balls too.
Post a Comment