AAA: Demand, global optimism contribute to higher fuel prices

Gasoline prices are rising following strong demand over the holidays and global market optimism, according to AAA. However, the newest COVID-19 variant is creating uncertainty in oil and gas prices.

On Thursday (Jan. 6), the U.S. average for a gallon of regular gasoline rose 2 cents to $3.30, from the same day in the previous week. It’s up $1.03 from the same time last year. The trend is similar in Arkansas with the statewide average of $2.93 per gallon, up 2 cents from last week and 93 cents from last year. The average gasoline price in Arkansas is the fourth lowest in the United States.

The strong holiday demand and optimism in global markets are leading crude oil prices to rise this week. The Organization of the Petroleum Exporting Countries and its partners (OPEC+) agreed this week to keep plans to add another 400,000 barrels per day of supply starting next month. According to AAA, the move suggests OPEC+ is optimistic that demand will remain strong even as COVID cases rise.

“There are many layers of uncertainty surrounding the omicron variant and how it will impact crude oil and gas prices,” said AAA spokesman Nick Chabarria. “However, market optimism for crude and gasoline demand has been leaning toward the upside, which is why we’ve been seeing slight price increases at the pump.”

In Northwest Arkansas, the average price of gasoline rose 4 cents to $2.93 per gallon from last week and is up 88 cents from last year. In the Fort Smith metro area, the price increased 1 cent to $2.92 from last week and up 96 cents from last year. In the Jonesboro metro area, the price increased 7 cents to $2.96 per gallon from last week and up 93 cents from last year. In the Little Rock metro area, the price rose by 1 cent to $2.89 per gallon from last week and up 93 cents from last year.

In comparison by state, Texas has the least expensive gasoline with an average of $2.91 per gallon.