With gas being among the most useful and valuable resources around the world, it’s an understatement to say that it’s prices can indeed send a wave of fluctuations around global activities.
With the current gas prices at an all time high in the United States, things do indeed seem bleak however, contrary to popular belief they are about to get better.
Majority of the world’s cars, busses, motorcycles and trucks (that account for more than 65% of all food deliveries around the US) run on gas. This hike in gas prices has indeed upset many. However, when there’s a problem there are always solutions and the US government has announced initiatives that will be taken to combat these prices.
The recent price hike in gas has left the gallen at around $4.91 which means this was more than a 61% in raise. However, there are certain reasons that have added to this problem.
Here are some of the reasons that have led to this price hike, and what is being done to solve this:
COVID-19 Pandemic
Believe if or not, but we’re still not out of the post-economical effects of the COVID-19 pandemic. As the pandemic hit the world, the demand for gas nearl vanished since most people were unable to travel.
This obviously meant that gas companies cut or halted producton. However, with the rapid development of COVID vaccines the demand shot up again leaving a hole in the market.
Gas suppliers were obviously not ready for this demand hike and hence led to a jump in prices.
The Ukraine War
Even though the war is taking part in Ukraine, it certainly has it’s fair share to put towards the rising gas prices in the United States.
Without going too deep into politics, the simple case is that while European countries turned away from Russian gas without an alternative that left a hole in the market. That then sent out ripples of a rising gas price problem.
Nearly three-fourths of the United State’s natural gas was sent to Europe that led to high gas prices in the US.
Production Challenges
It’s no secret that gas companies have been having a hard time producing gas. Using the same rules of economics, we can tell that once the supply shortens the demand rises hence drives up the prices.
These are some of the main problems that have plagued the United States and have led to skyrocketing gas prices. However, that’s not all because there is a light at the end of the tunnel and it has never been brighter.
What’s Being Done?
The government has started working on initiatives that will help bring down gas price and revive numerous industries along with it.
The House receelty approved a bill to combat what is known as “price gouging” the bill was approved in the House with a 217-207 vote ratio of Democrats and Republicans.
What Does This Mean?
The vote which now heads to the Senate will give President Biden the authority to declare an emergency making it illegal for companies to increase gas and home energy fuel prices.
The President has also ordered to release a record number of oil from the strategic reserve.
Severin Borenstein, who is an energy economist at UC Berkeley’s Haas School of Business, also gave some hopeful feedback: “The futures market is predicting that oil prices will decline by an amount that would translate to about 50 cents a gallon at the pump…”
With the struggles of the pandemic coming to a close and the gas companies eing pressured into more production at no higher price – things seem hopeful. The President further promised the American people to do everything he could to bring down the gas prices.
Looking up, the fall of gas prices doesn’t seem to far and it could be sooner than we think.
Once gas prices start to decline they will start making incredible profits for certain indsutires and among them is the transportation industry. Even with peak COVID-19 struggles, trucks were still on the go around the country helping transfer essential goods and foods.
Future proofing is very important and sometimes we need to keep our eyes peeled for opportunities that are about to explode. The return of gas prices will definitely explode profits in the trucking industry. So, now is the time to get in and book yourself a FREE Master Class with Kimberly Carver, founder of Transportation Academy.
This Free Master Class will equip you with everything you need to know about starting you own transport business so by the time gas prices return to normal, you’re all ready to hit the market.
Start today by booking your call now.https://go.oncehub.com/Transportationacademy
