Gas prices break records as fuel demand up, inventory down

Long Island’s gasoline prices are again reaching new heights after breaking records several days in March, and are expected to keep going up through the next few weeks into the Memorial Day weekend, industry experts said.

The average price of a gallon of regular gas on Long Island rose 21 cents over a week to hit $4.55 Monday, which was the fourth consecutive day that prices rose to record-breaking highs for the island. Monday’s price was 52% higher than the price a year earlier, $2.99, according to AAA.

In fact, the price of gas on Long Island rose daily between April 25 and May 9, said Denton Cinquegrana, chief oil analyst at Oil Price Information Service based in Rockville, Maryland.

The average national per-gallon price of regular gas Monday was $4.328, which was 46.1% higher than the price a year earlier, $2.96.

But Cinquegrana projected that the national price Tuesday would break the record of $4.331 that was set March 11.

With fuel prices soaring, Ramona Samuels of Farmingdale has had to cut back.

The rising cost of gas and other expenses spurred her to reduce unnecessary driving to save money, she said Monday while fueling her Honda Accord at a BP station in Farmingdale.

“[You] just don’t go out because you can’t afford it,” said Samuels, 45, who takes the Long Island Rail Road twice a week to her health care job in Manhattan.

Gas prices are breaking records again for several reasons, including the rising cost of crude oil, which is refined to produce gasoline, diesel and other fuels.

The largest component in the retail price of gas is the price of crude, and crude's  cost  is set by the global market, said Chris Higginbotham, spokesman for the U.S. Energy Information Administration. 

 The list of countries embargoing Russian crude oil because of the war in Ukraine is increasing, and the European Union is proposing a ban on Russian oil, Cinquegrana said. Uncertainty over more countries vying for crude from fewer sources, including those that supply the United States, sends the cost up.

The price of benchmark U.S. crude oil settled at $103.09 Monday, compared with $64.92 on May 10 last year, Cinquegrana said. 

Another factor in rising gas costs is the increasing consumer demand as people who had stayed at home because of the COVID-19 pandemic began returning to driving for work and leisure. While production of crude has increased, it still has not recovered to the amounts that existed before the health crisis started in early 2020, Higginbotham said.

U.S. gasoline inventories are about 10.5 million barrels below the seasonal norms, Cinquegrana said. "The East Coast is particularly low versus the average,” he said.

The result is more price pain at the fuel pumps.

At a 76 gas station in Huntington Station on Monday, the price of a gallon of regular gas was $4.39, according to GasBuddy, a Boston-based technology company that provides fuel price data. At a BP gas station in Holbrook, the price was $4.49, while it was $4.39 at a BP in Riverhead. 

The price was $4.55 at a Cumberland Farms gas station in Plainview, according to the retailer's website.

For Memorial Day, which is the last Monday in May and considered the unofficial kickoff of summer, millions of people take to the roads. Fuel experts predict gas prices will continue to rise.

“I would suspect that the national average leading into Memorial Day would be around $4.50 [a gallon]. I would suspect that would put New York and Long Island in the $4.60-$4.70 area,” Cinquegrana said.

The rising cost of gas might cut into plans for a summer vacation and other leisure activities for Forest Hills resident Daniel Braunstein and his family, he said while fueling up his Toyota Camry at the BP station in Farmingdale on Monday.

“I think we probably will go but maybe a shorter time span,” and the prices of airline tickets and gas will affect where the family chooses to go, said Braunstein, 32, who works as a medical manager in Farmingdale.

The U.S. may be in a new era in which high gas prices are the norm for many months, said Robert Sinclair Jr., spokesman in AAA’s Garden City office.

“We may see some lowering of prices at the end of the summer. But there is no guarantee," he said.

By Tory N. Parrish

tory.parrish@newsday.comToryParrish1

Tory N. Parrish covers retail and small business for Newsday. She has worked at the Pittsburgh Tribune-Review and Observer-Dispatch in Utica, N.Y.