The price of gas has been rising since the start of 2023. According to American Automobile Association's gas tracker, the average cost of regular gasoline has jumped by more than 40 cents, climbing to $3.509 on Friday (January 27).

"Rising gas demand and elevated oil prices have contributed to higher pump prices. If demand remains robust, drivers will likely see pump prices increase through the weekend," AAA said.

Colorado has seen the largest spike in prices, which have risen by nearly a dollar over the past month.

While the prices are still down from the record high of more than $5 a gallon set this summer, the 9% increase is the largest to start a year since 2009, according to CNN.

The recent increase in gas prices is primarily due to supply issues caused by a series of severe winter storms that have battered many parts of the country. For example, in Colorado, that state's only oil refinery was forced to shut down due to cold weather. When they tried to restart operations, a fire broke out and caused damage that could take several weeks to repair.

Overall, U.S. refineries are operating at 86% capacity, compared to a range in the mid-90s during December.

GasBuddy petroleum analyst Patrick De Haan predicts the prices will continue to rise and could hit $4 a gallon by April. De Haan said demand could surge as China begins lifting its COVID lockdowns. In addition, planned production pauses at several refineries could decrease the available supply of gasoline.

"With China reopening, you can't underscore it enough," he said. "The U.S. economy — when we reopened saw a level of pent-up demand," added De Haan. "The same would apply in China. That is likely to chart our course for the next 3-6 weeks."

Calendar Events