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Frank A. Douglass Insurance Agency

Gas prices hit 16-month highs

October 2019 was the last time you paid this much at the pump. Gas prices are spiking according to AAA, up nearly 40 cents in the last month. Looking at the state of Michigan, Upper Peninsula markets are generally paying more than their counterparts below the bridge, but it is tight. Marquette is the state’s most expensive region at $2.68 for regular unleaded. Traverse City is the cheapest at $2.54 and then there is a cluster in between. Metro Detroit, the largest market, is paying $2.65 on average.

Prices are up year-on-year as well, by about 15 cents across the state, compared to February 2020, which was pre-COVID and had to deal with significantly more demand. Economic shutdowns were not ordered for another three weeks. AAA says that pressure is expected to remain until refineries get back to full operation and deliveries are not hampered by power outages and other hindrances.

The best predictor for gasoline prices is the oil market. What it does today typically shows up at the pump about two weeks into the future. Brent crude, measured in London, England, sets the global value. It continues to push higher, now over $65 per barrel. Spring is traditionally oil’s best performance period as prices front run the busy summer driving season in America.

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