After dropping steadily from its April peak, gasoline prices are again rising because of the Midwest drought, Reuters reports. The dry conditions in cornfields have sparked an increase in ethanol prices, which in turn pushed pump prices higher. Refineries had temporary supply trouble, which also added to the higher prices.
The national average of regular gasoline reached $3.69 on Aug. 10, up 18 cents from July 27, according to the Lundberg Survey. This year, gasoline prices hit a high of $3.967 on April 6, but have fallen since then.
Because under U.S. law, a specific amount of ethanol must be sold, and a lot of that is blended into gasoline, said Trilby Lundberg, who runs the Lundberg Survey. “Right now, its impact on gasoline is that it’s adding to the cost,” she said. “It pales in comparison to the impact of crude on gasoline, but it’s among the non-crude items that has pushed up the price lately.”
Even crude oil has seen advances lately, with U.S. benchmark West Texas crude drifting up to $92.87 per barrel on Aug. 10. That’s around 5.5% higher this month so far. Earlier this summer, declining gasoline prices contributed to a record number of drivers on the road around the 4th of July holiday. (NACS: www.nacsonline.com)