Auto Best Pics

Top Menu

  • Guest Post inquiry

Main Menu

  • Home
  • Auto Parts
  • Automotive
  • Car Repair
  • Car Service
  • Driving Tips
  • Used Car
  • Vehicles
  • Guest Post inquiry

logo

Auto Best Pics

  • Home
  • Auto Parts
  • Automotive
  • Car Repair
  • Car Service
  • Driving Tips
  • Used Car
  • Vehicles
Opinion
Home›Opinion›Iran, Venezuela, China: Global crises conspire to raise gas prices

Iran, Venezuela, China: Global crises conspire to raise gas prices

By Rodriguez Davis
May 22, 2019
214
0
Share:
Venezuela oil
Although you may not pay a lot of attention to geopolitical goings-on, trouble in the Middle East — especially U.S. tensions with Iran, which, incidentally, is not one of Saudi Arabia’s favorite countries, either — may have a consequence on your disposable income. As tensions grow there and elsewhere, so do the odds of higher gasoline prices. Here’s why:

Iran: According to the U.S. Energy Information Agency (EIA), “the Strait of Hormuz is the world’s most important oil transit chokepoint.” In 2016, 18.5 million barrels of oil per day passed through the strait between Iran and Oman. What would one day’s interruption mean? The U.S. alone consumes 391 million gallons of gasoline per day, derived from 9.3 million barrels of oil. There have been weeks of saber-rattling by both the U.S. and Iran, culminating in intelligence showing Iran’s Revolutionary Guards loading missiles onto small boats. In a worst-case scenario, those missiles could be fired, either in anger or in miscalculation, at oil shipping or U.S. Navy vessels. Either way, the Strait of Hormuz would be closed for business. And even as it stands now, the tension alone has driven up crude oil prices.

Venezuela: This nation’s long struggle under President Nicolas Maduro, whom the U.S. regards as illegitimate, has been at an extreme for months. U.S. sanctions on PDVSA, Venezuela’s state-owned oil company, are having an effect, not the least of which are long lines of Venezuelans waiting for scarce gasoline in the oil-rich country. In 2018, according to the EIA, Venezuela as recently as three years ago exported 29 million barrels of oil per month to the United States. So long as Maduro hangs in there, you can write off Venezuela as a source for U.S. consumers.

Saudi Arabia/OPEC: You’ve probably been happy with the comparatively cheap gas of late, although it has crept up: According to GasBuddy, since the start of the year gas prices have increased, on average, 67 cents per gallon. During the same period in 2018, that was a 33 cent rise; a penny in 2017; and 22 cents in 2016. One reason for the increase — and why the EIA has just increased its oil price forecast in May — is because OPEC wasn’t happy with falling prices of crude that led to the low prices at the pump. The OPEC countries decided in December 2018 to decrease output to raise prices. Many — including the EIA — didn’t think that would hold, but now the EIA admits “compliance with these cuts has been more effective than EIA initially expected.” So while they thought that there would be a decrease in output of 1 million barrels of oil per day in 2019, given the OPEC compliance the figure is now 1.9 million.

China: On the not-exactly-bright side, the U.S. trade war with China may actually benefit gasoline prices — but not in a way you’d prefer. The trade war is bad in the macro sense: It could cause an overall slowdown in the global economy, but that means there would be decreased demand for petroleum.

According to a report prepared by Trade Partnership Worldwide for an organization named “Tariffs Hurt the Heartland,” if the U.S. goes all-in and levies a 25% tariff on all Chinese imports, the cost to the average U.S. family of four would be $2,294 per year.

At $3 per gallon, that $2,294 would have purchased 765 gallons of gas.

All of that notwithstanding, there is another factor that could cause a bump in gas prices in the days and weeks ahead: greater demand.

According to AAA, the Memorial Day weekend will see some 37.6 million Americans taking road trips, which is a record and a 3.5% increase over the number that hit the road last year. Even though AAA notes that gasoline prices are increasing, it suggests this won’t have much of an effect. Said Paula Twidale, vice president of AAA Travel, “Americans are eagerly anticipating the start of summer, and expensive gas prices won’t keep them home this Memorial Day weekend.”

Her colleague Jeanette Casselano, AAA gas price expert, said, “When gas prices are expensive, travelers may shorten the distance of a road trip, eat out less or look for free activities.”

It’s not surprising that the folks at AAA are not alarmed: Rising gas prices are a rite of summer. But lump that on top of this year’s entanglements with several of the globe’s biggest oil producers? That could prove to be a bit much.



[ad_2]

Source link

Previous Article

Stolen RV destroyed by woman during LAPD ...

Next Article

2020 BMW X7 M50i First Look: Now ...

Share:

Related articles More from author

  • Toyota Designs the Ultimate Off-Roader … for a Mission on the Moon – Technologue
    Car PerformanceClassic CarsNewsOpinion

    The Best Supra? It’s Not the New One

    May 27, 2019
    By Rodriguez Davis
  • Toyota Designs the Ultimate Off-Roader … for a Mission on the Moon – Technologue
    NewsOpinion

    Toyota Designs the Ultimate Off-Roader … for a Mission on the Moon – Technologue

    May 16, 2019
    By Rodriguez Davis
  • Look on the Bright Side: Why Colorful Cars are More Fun to Drive
    NewsOpinion

    Look on the Bright Side: Why Colorful Cars are More Fun to Drive

    May 26, 2019
    By Rodriguez Davis
  • Toyota Designs the Ultimate Off-Roader … for a Mission on the Moon – Technologue
    NewsOpinion

    5 Reasons Why Car Photography Matters

    May 26, 2019
    By Rodriguez Davis

Comments are closed.

  • Suzuki Jimny
    suzuki jimny

    Suzuki Jimny offroad test in England

  • Automotive

    Getting the best lorry rental to go for

  • Here's the 2020 Mercedes-AMG GLB 45 in spy shots
    mercedes-amgmercedes-benz glb-class

    Here’s the 2020 Mercedes-AMG GLB 45 in spy shots

  • Recent

  • Popular

  • Comments

  • Add a Little Luxury to Your Drive with the Highline Series

    By Rodriguez Davis
    May 1, 2022
  • Which Cars Are Considered High-Performance?

    By Rodriguez Davis
    March 11, 2022
  • Pitfalls to watch out for when conducting auto estimates

    By Rodriguez Davis
    March 9, 2022
  • Top 5 Reasons to Buy Second Hand Honda Activa in Bangalore

    By Rodriguez Davis
    February 18, 2022
  • Should you buy snatch straps or kinetic ropes?

    By Rodriguez Davis
    January 31, 2022
  • Add a Little Luxury to Your Drive with the Highline Series

    By Rodriguez Davis
    May 1, 2022
  • Strategies For Locating A Town Vehicle Service

    By Rodriguez Davis
    June 2, 2018
  • Travel In Luxury By Having An Airport terminal Vehicle Service

    By Rodriguez Davis
    June 8, 2018
  • Employ a Vehicle Service for the Vacation

    By Rodriguez Davis
    June 12, 2018
  • Luxury Vehicle Services – Researching and Selecting Your Luxury Vehicle Service

    By Rodriguez Davis
    June 12, 2018

Recent Posts

  • Add a Little Luxury to Your Drive with the Highline Series May 1, 2022
  • Which Cars Are Considered High-Performance? March 11, 2022
  • Pitfalls to watch out for when conducting auto estimates March 9, 2022
  • Top 5 Reasons to Buy Second Hand Honda Activa in Bangalore February 18, 2022
  • Should you buy snatch straps or kinetic ropes? January 31, 2022
  • Benefits of Selling your Car to a Dealership December 29, 2021

2022

  • – May (1)
    • Add a Little Luxury to Your Drive with the Highline Series
  • + March (2)
  • + February (1)
  • + January (1)

2021

  • + December (2)
  • + September (1)
  • + August (2)
  • + July (4)
  • + June (3)
  • + May (3)
  • + February (3)

2020

  • + December (2)
  • + November (6)
  • + October (3)
  • + September (5)
  • + August (3)
  • + July (1)
  • + June (11)
  • + May (2)
  • + April (1)
  • + March (2)
  • + February (1)
  • + January (2)

2019

  • + December (1)
  • + November (2)
  • + October (2)
  • + August (6)
  • + July (3)
  • + May (258)
  • + April (4)
  • + March (1)
  • + February (5)
  • + January (9)

2018

  • + December (5)
  • + November (3)
  • + October (4)
  • + September (1)
  • + August (2)
  • + June (4)
  • + May (1)

Tags

alloy ute trays car dealerships Fredericton Cutequeen Cutequeen Trading Sheepskin Stretch-On Steering Wheel Cover Black JIANXIN-09-02-09-02 off road Yamaha finance
  • Guest Post inquiry
© 2021 Auto Best Pics- All Rights Reserved.