Top 6 reasons Gas Prices have spiked above $3 per gallon

Thought gas prices couldn’t go any higher? The average cost of a gallon of gasoline just reached a threshold Americans haven’t seen in over six and a half years — and prices have kept on going.

With a major pipeline shut down, apparently by a group of Russian hackers, the typical U.S. gas price hit $3.01 per gallon on Wednesday and $3.03 on Thursday, says auto club AAA. It’s the first time since October 2014 that prices have jumped past $3.

The pipeline hack has sparked shortages and some hoarding; says 7 in 10 North Carolina service stations are out of fuel, according to multiple media reports. But the hacking isn’t the only cause of that worsening pain at the pumps.

Here are six reasons the cost of gas is going up, plus predictions for how high prices are likely to go — and tips on ways to save money, to help pay for your costlier fill-ups.

1. Colonial Pipeline hack throttles supply

Colonial Pipeline shutdown due to hackers

On Friday, a cyberattack carried out by a group of Russian hackers known as DarkSide brought operations at the largest gas pipeline in the U.S. to a complete standstill. Obviously, that has been a huge deal.

The Texas-to-New-Jersey Colonial Pipeline provides about 45% of the fuel used by the Eastern Seaboard. According to Colonial’s own data, each day the pipeline is down removes about 100 million gallons of gas from the marketplace.

Technicians restarted operations late Wednesday afternoon, but Colonial said it would take several days for its delivery system to return to normal. To beat potential fuel shortages, drivers in some states have rushed to fill up — causing service stations to run out of gas.

Though gas prices are going up, mortgage rates remain historically low — meaning if you’re a homeowner, one way to offset the rising cost of fuel is by refinancing your home loan. The mortgage data and technology provider Black Knight recently said 13 million homeowners could save an average $283 a month by refinancing.

2. Crude oil prices were already going up

As with gasoline, the cost of crude oil tanked in 2020 while COVID-19 was wrecking economies and stopping people from traveling. To prop up oil prices, the OPEC cartel and its allies slashed oil production.

OPEC has been slow to boost output again, and crude prices have responded by surging higher. After a year of soft prices, West Texas Intermediate crude has been trading around $60 a barrel for months now, and Goldman Sachs expects Brent crude prices to hit $75 by the end of June

OPEC and the allies announced on April 1 that they’d gradually raise production, which could help stabilize prices.

The cartel boosted output to a three-month high during April as Iran cranked up its production to a level not seen since May 2019, according to a survey by Argus Media.

3. Vaccinations are likely to boost travel

Covid Vaccine

As more Americans are vaccinated and life begins to return to something closer to normal, people are likely to drive and fly more. And that activity will contribute to rising fuel costs.

“As COVID-19 impacts continue to subside with improved mitigation and vaccination efforts, vehicle miles traveled will increase, resulting in more gasoline demand,” the Energy Information Administration says in its summer fuels outlook.

A good way to fight higher gas costs is by shopping around for lower prices, because what you pay can vary by up to $1 a gallon within the typical metro area, according to GasBuddy.

Also, you might want to consider replacing your vehicle with a more fuel-efficient model. This tax season, you could turn your tax refund into a new set of wheels.

4. Stimulus checks have pumped up spending

Stimulus Check Spending

Since President Joe Biden signed his $1.9 trillion COVID relief package two months ago, Americans have been receiving a third round of stimulus checks, for up to $1,400 each. The aid was expected to help lift gas prices by prompting consumers to get out and shop.

Goldman Sachs has estimated that $2 trillion in economic stimulus spending over 2021 and 2022 could pump up U.S. oil demand by roughly 200,000 barrels a day. If supplies don’t keep up, that higher demand will mean higher fuel prices.

With gasoline already more expensive, another way to balance out those higher costs is by spending less on other purchases.

You might download a free browser add-on that will point you in the direction of lower prices and other savings every time you shop online.

5. The pandemic closed a bunch of refineries

oil refineries closed due to pandemic

Plummeting fuel sales triggered by COVID had the oil and gas industry reeling last year. By late 2020 there were more than a dozen refinery closures that reduced U.S. production by more than 1 billion barrels per day.

“It’s possible some capacity could come back online in the 2022-2023 timeframe, but by and large, we think these closure announcements will mostly prove permanent,” Raymond James analyst Justin Jenkins said about the refinery shutdowns in a December report.

U.S. oil and gas producers lost tens of thousands of jobs last year, and laid-off workers were left scrambling to make ends meet.

Many struggling Americans have been leaning on credit cards more than usual, to get by during the pandemic. If that’s you, a lower-interest debt consolidation loan can cut the amount you pay in interest charges each month — and help you afford the higher prices at the pump.

6. Summer gas blends cost more

Summer gas blends cost more

Gasoline that costs over $3 a gallon may be the norm once people start heading out on their summer road trips. Both AAA and GasBuddy had predicted $3-a-gallon gas even before the Colonial Pipeline hack.

In early April, GasBuddy’s Patrick De Haan warned we could see “a run at a national average of $3 per gallon in the months ahead.”

The forecasts factored in the transition to pricier summertime blends of gasoline. Higher-grade gasoline is used in summer months to reduce emissions that cause smog; those blends can cost up to 15 cents more per gallon, according to the service station trade group NACS.

Looking for ways to save on the cost of driving will be a smart strategy — but, then again, it’s always a wise practice. For example, regular comparison shopping for car insurance can save you as much as $1,100 a year, various studies have found.

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Caleb Kennedy will no longer be on American Idol after a controversial video surfaces

“American Idol” finalist Caleb Kennedy is exiting the ABC show after a social media post resurfaced depicting him sitting next to and filming someone wearing what appears to be a Ku Klux Klan hood.

With 16-year-old Kennedy no longer in the competition, Sunday’s episode will feature the show’s top four singers with one contestant elimination.

The video in question shows a younger Kennedy sitting next to a person who is wearing a white hood similar to those adopted as a symbol of hate by the white supremacist domestic terrorist group Ku Klux Klan.

In a statement on his social media, Kennedy, native of Roebuck, South Carolina, addressed the video and his elimination from “American Idol.”

“Hey y’all, this is gonna be a bit of a surprise, but I am no longer gonna be on ‘American Idol.’ There was a video that surfaced on the internet and it displayed actions that were not meant to be taken in that way,” Kennedy wrote. “I was younger and did not think about the actions, but that’s not an excuse. I wanna say sorry to all my fans and everyone who I have let down. I’ll be taking a little time off social media to better myself, but saying that, I know this has hurt and disappointed a lot of people and made people lose respect for me. I’m so sorry! I pray that I can one day regain your trust in who I am and have your respect! Thank you for supporting me.”

In a statement to the Herald-Journal, Kennedy’s mother, Anita Guy, said that the video was taken when Kennedy was 12, after watching the film “The Strangers: Prey at Night,” in which a character wears a hood over his head.

“I hate this has happened and how Caleb is being portrayed by people online,” Guy said. “This video was taken after Caleb had watched the movie ‘The Strangers: Prey at Night’ and they were imitating those characters. It had nothing to do with the Ku Klux Klan, but I know that’s how it looks. Caleb doesn’t have a racist bone in his body. He loves everyone and has friends of all races.”

Kennedy is a country singer, performing covers of Willie Nelson and Jason Aldean on “Idol,” as well as a few of his own original songs. He survived the latest cut on the show, from seven to five finalists, on Sunday night.

California bar owner arrested for selling fake Covid-19 Vaccination Cards

Undercover agents were able to buy the fraudulent cards for $20 each at a bar in Clements, Calif., according to the authorities. Federal officials say the problem has grown during the pandemic.

A California bar owner was arrested this week on charges that he had sold fake Covid-19 vaccination cards at his business, prosecutors said.

The owner, Todd Anderson, 59, of Acampo, Calif., was arrested on Tuesday and charged with identity theft, forging government documents, falsifying medical records and having a loaded unregistered handgun, Tori Verber Salazar, the San Joaquin County district attorney, said in a statement this week.

“It is disheartening to have members in our community show flagrant disregard for public health in the midst of a pandemic,” Ms. Salazar said in the statement. “Distributing, falsifying or purchasing fake COVID-19 vaccine cards is against the law and endangers yourself and those around you.”Mr. Anderson declined to comment on Friday. His arraignment is set for May 18.

Agents from the California Department of Alcoholic Beverage Control began their investigation into Mr. Anderson after they received a complaint stating that fake cards were being sold at his business, the Old Corner Saloon in Clements, Calif., which is about 40 miles southeast of Sacramento.

In April, undercover agents were able to buy fraudulent cards four times, the Department of Alcoholic Beverage Control said.

The cards were sold for $20 each, according to the district attorney’s office.

“A number of the cards were found for distribution during a search warrant executed at the bar,” the department said. The search, it said, also uncovered more supplies, including 30 blank cards and a laminating machine, which were confiscated.

The Department of Alcoholic Beverage Control and the San Joaquin County Sheriff’s Office took part in Mr. Anderson’s arrest.

Each of the charges that Mr. Anderson faces is a felony carrying a maximum penalty of three years in prison except falsifying medical records, which is a misdemeanor carrying a maximum term of six months in jail.

Fake vaccination record cards have become a growing problem during the pandemic, according to the authorities. Vaccination cards provide proof that someone has been inoculated against Covid-19 in the United States and list the type of vaccine.

A screenshot from CBS showing the Old Corner Saloon in Clements, Calif.

The federal Department of Health and Human Services’ Office of Inspector General and the F.B.I. recently published a public service announcement warning the public that selling fake vaccination cards with a government logo on them is a crime.

The advisory warned the publicabout those who sell fake Covid-19 vaccination cards and encourage others to print fake cards at home. The cards have been advertised on social media sites as well as e-commerce platforms and blogs.

“If you did not receive the vaccine, do not buy fake vaccine cards, do not make your own vaccine cards, and do not fill in blank vaccination record cards with false information,” the announcement said.

The Centers for Disease Control and Prevention has also said it is “aware of cases of fraud regarding counterfeit Covid-19 vaccine cards.” It has asked people not to share images of their personal information or vaccine cards on social media.

In addition to the criminal charges against Mr. Anderson, the Department of Alcoholic Beverage Control said it would file disciplinary action against the bar. That action can include a suspension or revocation of its Alcohol Beverage Control license.

According to the bar’s website, Mr. Anderson is a Minnesota native who has lived in San Joaquin County since 1986 and has owned the business since 2005.