OPEC cuts oil output. Will gas prices start climbing again?
OPEC and allied oil-producing countries, including Russia, cut their supplies to the global economy by 100,000 barrels per day, underlining their unhappiness with crude prices that have sagged because of recession fears.
The decision Monday by energy ministers ignores calls from U.S. President Joe Biden to pump more oil to lower gasoline prices and the burden on consumers.
Worries about slumping future demand have helped send prices down from June peaks of over $120 per barrel, cutting into the windfall for the government budgets of OPEC+ countries but proving a blessing for drivers in the U.S. as pump prices have eased.
The energy minsters said in a statement that the September increase was only for that month, and that the group could meet again at any time to address market developments.
Other factors are lurking that could influence the price of oil. For one, the Group of Seven major democracies plan to impose a price cap on imports of Russian oil and what effect that might have on the market. The price level for the cap has not yet been set.
Oil prices have gyrated in recent months: Recession fears have pushed them down, while worries of a loss of Russian oil because of sanctions over its invasion of Ukraine pushed them up.
If you’re open-minded about your vacation destination, consider driving through a region with below-average gas prices. On June 1, 10 states had average gas prices below $4.30 per gallon for regular grade gasoline, according to AAA data.
Those states, ranked from cheapest to most expensive, were:
9. South Carolina.
Given how many of those states border each other, it’d be fairly easy to plan a road trip through the South or Midwest. You could start in St. Louis, and make the roughly four-hour drive on Interstate 70 across the state to Kansas City, Missouri. Make time for a pit stop in Columbia, which is a quintessential college town with the University of Missouri. Boonville is another great stop, where you can tour Warm Springs Ranch, home of the iconic Budweiser Clydesdales. (Walking tours start at $15 .) From Kansas City, it’s about three hours on to Omaha, Nebraska, where you can try the allegedly original Reuben sandwich.
If you’re renting a car, understand that rental car prices can vary dramatically depending on the rental company, whether you’re renting from an airport location versus downtown, and how far in advance you book.
Speaking of renting a car, this might be the year you rent an electric vehicle. The EV may have a more expensive rental price, but it could be cheaper than renting a gas-powered car and filling its tank. AAA has a helpful gas calculator tool that factors in the type of car and where you’re driving to help you see the trade-offs.
Hotel and vacation rental companies also are making it easier to search for accommodations that offer electric vehicle charging. More hotels are promoting electric vehicle charging as a hotel perk, right alongside traditional amenities like pools and breakfast buffets. Many hotels even allow you to charge your car at no cost.
If rental car prices are brutally high, consider booking with alternative rental car companies like Turo or Getaround, which can be cheaper than a major car rental company. Many of these companies are relatively new and allow you to book cars directly from the owners, functioning as an “Airbnb for cars.”
For example, the cost of a weeklong car rental from San Francisco International Airport during the first week of July for a standard, gas-powered car like a Volkswagen Jetta would average about $640 . Head to peer-to-peer car-sharing site Turo, and there are more than a dozen Teslas available to book in San Francisco on the same dates for less than $800.
If you filled the Jetta’s roughly 13-gallon gas tank twice at $6 a gallon (which isn’t unheard of in some states like California), you’d pay more than $150 in gas. That cost plus the rental would have you paying roughly the same amount as booking the Tesla.
With so many variables, it pays to shop around before you make reservations.
If driving a gas-powered car is non-negotiable, master the art of saving money on gas. Download apps like GasBuddy, which track local gas prices and can help guide you to the cheapest station near you. It also helps to drive more efficiently. Adjusting how you speed up, brake or use cruise control can have an impact on your gas usage.
And if all else fails and you’re stuck with a gargantuan gas bill, at least earn rewards for your spending through a rewards credit card. The best gas credit cards can typically net at least 3% back in rewards for your gas station spending.