CARY, NC (WNCN) – President Joe Biden bans Russian oil imports to the United States. What impact does this have on drivers?
Craig Stephenson is President of Cary Oil, a wholesaler that supplies gas to approximately 300 gas stations across North Carolina.
He said the ban on Russian oil is likely to push up gas prices.
“We can’t pinpoint for our stations or our customers exactly where this product is coming from, but it certainly has an impact on price because it’s a world price that’s being set in a global market,” Stephenson said.
Stephenson said the wholesale price for gas on Tuesday was about $3.70, about 50 cents more than Cary Oil paid a week ago. He said the price usually changes by 8 to 10 cents a week.
The gasoline you buy has probably been in the pump for a few days and must have come from a refinery beforehand. In the case of Cary Oil, it takes about two weeks to get from the refineries they buy from to their distribution center.
Why are gas stations raising prices along with crude oil not making it into your car for weeks?
“The challenge is that while their inventory cost is less than replacement cost in a rising price environment, they need to buy replacement cost at then-current value,” Stephenson said. “So, you know, they have to prepare, for the next shipment that they get, so they have to move up when wholesale prices go up.”
According to the AAA, the average gas price in the US hit an all-time high.
CBS 17 asked motorists how much fare increase they could afford.
“It looks like it’s about to get there, probably the way we’re seeing it right now,” said driver Connie Jones. “It’s $4.64, $5 is a lot, yeah, that’ll probably keep me at home for a bit.”
As for how much higher prices could go, Stephenson said a key factor is if more countries follow the US and UK lead in banning Russian oil.
https://www.cbs17.com/news/cary-oil-expert-explains-why-gas-prices-go-up-as-soon-as-oil-prices-spike/ Cary’s oil expert explains why gas prices go up when oil prices go up