Gas prices on the rise: Travel, Mideast issues create spike at pump

Regular grade gas is $2.39 at the Royal Farms on South State Street in Dover on Saturday. Gas prices are expected to rise because of the current situation with Iran. Delaware State News/Marc Clery

DOVER — A year-end spike in holiday road travel and ongoing turmoil in the Middle East helped push higher prices at gas pumps, according to AAA-Mid Atlantic.

Averages were higher both nationally and across the Delaware Valley region, officials said. Oil prices are above the $60 mark again this week as drops in crude oil inventory, according to AAA.

While AAA expects gas prices to dip in the coming weeks as a decrease in demand for gasoline typically follows the holiday season, higher oil prices may stunt the drop.

In Delaware, gasoline cost $2.38 per gallon Friday, compared to $2.34 a week ago and $2.10 at the same time last year. Nationally, the same time frame costs were $2.58, $2.55 and $2.24.

Philadelphia area gas prices in five counties swung from the recent $2.79 per gallon cost to $2.77 last week and $2.48 a year ago. In south New Jersey, prices were $2.54, 2.50 and $2.23, respectively, while overall Pennsylvania costs ranged from $2.79 most recently to $2.77 last week and $2.48 a year ago.

At the close of New York Mercantile Exchange trading Friday, West Texas Intermediate crude oil settled at $63.05 per barrel, almost 2.16 percent higher than last Friday’s close, AAA said.

A woman fills her tank at the Royal Farms on South State Street in Dover on Saturday. Delaware State News/Marc Clery

Crude prices hit an eight-month high Friday, following the death of Maj. Gen. Qasem Soleimani, Iran’s intelligence chief, as a result of a U.S. airstrike Thursday. About a fifth of the world’s oil supply passes through the narrow Strait of Hormuz, off the southern coast of Iran.

According to AAA, if the route were closed due to threats of attacks, it could be a setback to the global economy. A crude oil price increase is to be expected when it comes to current events and the impact on consumers will depend on how large the price increase is and how long that price increase lasts.

“Local motorists welcomed 2020 with slightly higher prices at the pump, following a record number of drivers hitting the road for the holidays,” said Jana L. Tidwell, manager of Public and Government Affairs for AAA Mid-Atlantic.

“Like motorists, AAA is watching the current situation in the Middle East in terms of potential short- and long-term impacts to crude oil and gasoline prices. At this point is too soon to speculate.”

Following the U.S. airstrike on Iran, AAA said, motorists will have to deal with a lot of “what-if” situations ranging from possible diplomatic disagreements to full on attacks on the Middle Eastern oil infrastructure. Some analysts see Friday’s market reaction to the event as temperate, citing the reaction to last year’s attacks on the Saudi oil installation at Abqaiq in mid-September, according to AAA.