LIVONIA, Mich. – Many people have questions as gas prices hit record highs in Metro Detroit and across the country.
How long is this going to last? How much higher could gas prices really go? Local 4′s Priya Mann spoke with Denton Cinquegrana with Oil Price Information Service.
Question: According to the American Fuel and Petrochemical Manufacturers Association the U.S. gets about 3% of its crude oil from Russia. The spike in prices seems disproportionate. Are we being lied to?
Answer: Experts said only 2% to 3% of our weekly intake of crude oil is from Russia. “But with that being said this is a global market and you’re probably removing 3 to 4 million barrels a day of Russian oil and product. It’s going to lift prices,” Denton Cinquegrana said.
In the span of just one week, AAA said gas prices have jumped by more than 40 cents. As the Russian invasion of Ukraine intensifies, experts predict gas prices will keep rising.
Question: How long will this last?
Answer: “That’s the million-dollar question right there. Even if Putin decides to withdraw, it will take time to unravel all that and at the same time, you have U.S. producers looking to increase production. But, again, you can’t snap your finger, wave a wand and all of a sudden you’re producing more oil,” Denton Cinquegrana said. “This, unfortunately, has some staying power. Wish I had better news for consumers. This is going to stick around for a while.”
Experts say the pain at the pump could just be the beginning.
“One thing no one is talking about is diesel prices, diesel prices are quickly approaching $5 a gallon. Everything moves around by truck or train by the use of diesel,” Denton Cinquegrana said.
The cost for everything from milk, eggs, bread and gas will be impacted by rising oil prices. So why not increase oil production in the U.S.?
“The Jones Act is a real political football here. You waive the Jones Act,” Denton Cinquegrana said. “It could really reduce the price of moving goods particularly oil and refined products.”
The Jones Act is a law that requires any ship moving from one U.S. port to another to be an American flagged ship with a U.S. crew, but that makes them more expensive.
“Shipping companies probably love the Jones Act, while importers and exporters and people who are moving goods and products probably hate it,” Denton Cinquegrana said.
Question: What should I do if I feel there has been price fixing or gas gouging?
Answer: Attorney General Dana Nessel remains committed to fighting higher gasoline prices when those price increases violate the law. If you become aware of direct evidence of a conspiracy between companies, or have verifiable evidence of a retailer charging a price “grossly in excess of the price at which similar property or services are sold,” please contact the Attorney General’s Consumer Protection Division:
Consumer Protection Division
P.O. Box 30213 Lansing, MI 48909
- Phone: 517-335-7599
- Toll-free: 877-765-8388
- Fax: 517-241-3771