Why are gas prices still so high?

The US is recovering unprecedented amounts of oil through fracking and other collection procedures. That isn't translating to lower prices at the pump, however.

By Kim Peterson Jul 22, 2013 5:50PM
The U.S. is practically swimming in new crude oil. Some have predicted this surge could drop prices to $50 a barrel by the end of the year.

So why are gas prices still going up? The national average for a gallon of unleaded is $3.67, up from $3.61 a week ago and $3.58 a month ago, according to the AAA Fuel Gauge Report.

"Prices are very, very bubbly," said Tom Kloza, the chief oil analyst at GasBuddy.com, in this interview.
The Northeast is seeing high prices now because of refinery issues, Kloza added. And he thinks prices overall will continue to wobble a little bit higher.

Traders are betting a record $40 billion that prices will rise for crude oil, through futures and options contracts, Kloza said.
Image: Buying gas (© moodboard/Corbis/Corbis)
Gasoline futures shot higher earlier this month, partly as traders reacted to production glitches. Motiva Enterprises, for example, shut down some production at a refinery in Texas, while Phillips 66 (PSX) said a power outage stalled production in Oklahoma, The Wall Street Journal reported.

Still, Kloza said he doesn't think we'll hit the 2013 record for the price of a gallon of gas, which is $3.78. Prices are just too high already.

"These numbers are really really frothy," he added. He expects gas prices to come down after Labor Day and in the last 100 days of the year. Between now and Labor Day, it's a toss-up, particularly because late-summer hurricanes could impact oil prices.

More on moneyNOW




1353Comments
Jul 22, 2013 6:13PM
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What a crock of Shiite. The prices are high because of greed and nothing more or less.
Jul 22, 2013 6:14PM
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Frothy is a good way of saying that big oil is gouging and fleecing America again. No reason for the price of fuel now. Should be under $1.99 a gallon but today it went up .15 cents a gallon for no reason.
Jul 22, 2013 6:16PM
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It went up over 27 cents/gal the other day.  Greedy bastards need more money but they will blame it on, the wind, to much sun, the ozone layer, hurricanes in egypt, flooding in Arizona and UFO's over

the Bermuda triangle....

Jul 22, 2013 6:17PM
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it's pretty damn simple... it's the rich screwing the little people... the oil companies can't say it keeps costing them more and more to make it.. then report record profits year after year... who do they really think they are fooling... something is going to have to be done.. that simple
Jul 22, 2013 6:22PM
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take oil off the board of trade and the price will drop the next day!!
Jul 22, 2013 6:19PM
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Very simple, because they can get away with it. That's how every year they report a new "record profit."

In this world, unfortunately, it's every man for himself. There isn't a company out there that cares about anything (anyone) except for their bottom line.

Jul 22, 2013 6:28PM
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I live in Chicago's Cook county (crook county) with a BP refinery less then 30 miles away in Indiana yet we are the nations highest average in gasoline... absolute ****, want to spark the economy? how about $2/gal gas so i can spend the rest of my money elsewhere... no one talks about this anymore, like $4/gal is completely normal...
Jul 22, 2013 6:22PM
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Manipulation by the greedy because they can.
Jul 22, 2013 6:31PM
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So.......Oil companies shut down some  production and ...wink wink...had a power outage......just when prices started going down....then there are the refinery issues.......in short ...double speak to gouge the consumers....to give more record profits to the rich...
Jul 22, 2013 6:39PM
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We have tons of oil and fuel, we have a surplus!  Oil prices keep going up because oil companies can keep raising prices without any worry of any intervention.  Greed, greed and greed are the 3 major reasons for gas prices are so high.
Jul 22, 2013 6:19PM
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We haven't built an Oil Refinery since the 70s.. At this point doesn't matter how much Oil we pump, there is no Place to refine into Gas or Diesel.. It would make way to much sense to Build a Refinery up in the Dakota's. Just ask any Tree hugger or Politician

 

Jul 22, 2013 6:26PM
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Bastards on wallstreet.........................
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DAMN RIGHT !!!  WAKE UP AND GO OUT IN THE STREET AND LET THESE CROOKS AND THEIR CROOKED POLITICIANS AND WALL STREET BANKERS WHO COULD CARE LES ABOUT THE WORKING AMN AND THEIR FAMILIES THAT WE AS AMERICANS HAVE HAD ENOUGH!!!!
Jul 22, 2013 6:15PM
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because the oil companys are crooks, along with obama. 
Jul 22, 2013 6:26PM
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When they "gamble" on "futures and options contracts", you know the public has to lose. And they also know that we need the gasoline - or medicine - or food - or housing - whatever, so we'll have to buy it. The stock markets and commodities markets are two enormous chains of Casinos for the super-wealthy.
Jul 22, 2013 6:29PM
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gas prices go up because they can.  simple monopoly, supply and demand issues. 

 

while US is "flush" with more oil, it is NOT usa's oil.  it's owned by the gas companies and they can charge market prices for their oil or gas. 

Jul 22, 2013 6:34PM
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Because they can! Remember when they said it was because we used too much!
Jul 22, 2013 6:29PM
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Gas could become five cents a gallon.  It will only leave room for more taxes,  maintaining that cost for which all us sheep are use to paying....They are not drilling for oil to save us money, drilling it so they can make it...
Jul 22, 2013 6:29PM
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every time the gdp is very low , gasoline price seems to be the easiest  way to make it look good , since, we will have to buy it don't matter how high it will go because is a necessity. 
Jul 22, 2013 6:29PM
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The main reasons are there has not been a new refinery built in this country for yrs because of libs, another reason with all the blends that the gov;t has the oil co. do, the gov't makes more money from oil than the oil co. in taxes, Obama has cut permits on off shore and public lands.
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