A nonprofit publication of the Kentucky Center for Public Service Journalism

AAA: Gas prices may rise due to Iranian sanctions waivers announcement by U.S. State Department

After posting a week-over-week drop of 3 cents, gas prices in Kentucky have begun to creep upward following the U.S. State Department’s announcement to end sanction waivers for countries that import oil from Iran.

Crude oil prices are seeing an immediate impact as a result of Monday’s announcement.

“With the end of waiver sanctions, Americans could see increased gas prices this summer, leading to the national average flirting with the $3 per gallon mark, similar to what we saw last summer,” says Lori Weaver Hawkins, public and government affairs manager, AAA Blue Grass. “The immediate impact will be to crude oil prices, which is then passed on to retail, likely affecting gas prices for summer travel.”

The average price for a gallon of regular gas in Kentucky today is $2.72, according to AAA’s latest analysis of gas prices. That is 4 cents higher than Tuesday’s $2.68. The magnitude of the retail increase will depend on how far crude oil prices rise and the duration crude remains at the higher price point in the market.

However, regional refinery utilization has increased from 86.5 percent to 92.4 percent, indicating that the coming weeks could see increased production and stock levels. This could potentially help to keep gas prices stable.

Despite the impacts, higher gas prices are not expected to diminish summer travel plans. According to a recent AAA Travel survey, nearly 100 million Americans are planning to take a family vacation in 2019, slightly more than last year. Nearly half of American families will travel by car.

“We do not expect higher gas prices to impact summer travel,” said Weaver Hawkins. “Prices are on par with prices at this time last year when Americans still hit the road in record numbers for summer travel. It’s more likely travelers will find other ways to save, such as shortening the distance of a road trip, eating out less or looking for free activities, rather than cancelling their summer road trip altogether.”

Drivers can save at the pump by using the AAA Mobile App to find the cheapest gas prices in their area.

AAA members can also find additional savings by signing up for the Shell Fuel Rewards Program. Members can sign up for free and save 5 cents per gallon at participating Shell stations.

For a limited time, members can save 30 cents on their first fill up until April 30.

From American Automobile Association

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