LITTLE ROCK, Ark. – Gas prices are once again on a steep rise. According to AAA the price for a gallon of unleaded gas in Arkansas has risen 16 cents in the last week and 34 cents in the last month.
“Just $10 today. It’s bad”, Tabari Herron explained as he set the amount he’d pay for gas.
Like most customers, Herron is buying unleaded fuel. Last summer, Arkansas broke records with prices above $4.50 a gallon for unleaded gas. As of Aug. 1, the state average price is $3.44 and likely will continue to rise according to AAA.
“You might want to budget for about $3.50 to $3.75 a gallon. I don’t think we’re out of the woods yet,” AAA Public Affairs Specialist Donald Redman said.
Redman said one of the first contributors to the steady rise is the Organization of the Petroleum Exporting Countries (OPEC) cutting its production by millions of barrels each day earlier this year.
The most recent jump of close to 20 cents a week, is partly due to weather making refineries less productive.
“Recently a large swath of the country was affected by brownouts due largely to weakness in the grid, and that’s impacting a lot of those refineries which is only compounding the issue that we’re seeing,” Redman said.
Crude oil accounts for approximately half of the cost of each gallon of gas. It’s also used heavily in Diesel which keeps the travel business Little Rock Coaches running. Owner Cary Martin shared that his fleet of motorcoaches only gets between six to seven miles a gallon.
“We have a 15,000-gallon fuel tank and every time the cost of fuel goes up 10 cents, we pay an additional $1500,” Martin said.
Popular trips to Washington or Orlando take over 2,000 miles to travel there and back. Because their travel contracts sometimes lock the price often months in advance, the cost is often eaten by the company.
“The cost of fuel affects everyone, and obviously the more you use, the more it’s going to impact you,” Martin said. “And unfortunately in the transportation business, you pick any company, they are going to tell you this is a huge impact on their bottom line.”
So the cost of transportation will eventually find its way to consumers. If it’s not drip by drip, it will be inflation.
Tony Sloan, lives in Cabot. At the pump, he said, “You have to be resourceful in every way you can. (It) affects your whole life. Everything.”
One way prices will decrease is if demand decreases. Redman said in the past few weeks demand has lessened, but it will still take time before a change is seen. Hurricane season on the horizon is also a risk to some of America’s top oil producers in the Gulf of Mexico.
In the Little Rock/North Little Rock metro, AAA has prices averaging $3.38, up from $3.22 a week before. Cleveland County has the highest average price in the state at $3.79, while Prairie County is the lowest in the state at $3.35 according to AAA.