As I’m sure you’ve noticed, the gas prices at your local gas station have been creeping up. The average price for a regular gallon of gasoline increased $0.096 this week, and it’s up $0.178 over the past month. I’m expecting it to continue to rise as we head into spring (see my more detailed forecast below).

Utah’s small jump in gas prices comes down to simple supply mechanics, not anything dramatic. Over the past week, fuel coming into the region tightened slightly as nearby refineries produced a bit less gasoline. Utah doesn’t have many alternative supply routes, so when less fuel is available—even temporarily—wholesale prices rise. Stations then pass that increase along at the pump, usually within days.

Broader oil prices added a little pressure, but they weren’t the main driver. Crude oil costs edged up globally, which nudges gasoline prices higher everywhere. Still, Utah’s increase was mostly local. Basically, a small squeeze in regional fuel supply, plus steady oil prices, equals a penny or so more per gallon.

Utah gas prices are being pulled in two directions at once, which helps explain the slow but steady creep higher.

On the upside, regional fuel supply has tightened. Refineries in the Rockies are running hard, but producing slightly less gasoline, and inventories have slipped. In a landlocked market like Utah, even small supply changes can push prices higher. We’re also entering the seasonal window when prices typically rise as refineries shift toward more expensive summer gasoline blends.

On the downside, crude oil prices have remained low, which limits how fast prices can climb in the near term. The result: modest increases now, with more upward pressure building into the next month as seasonal factors take over.

One reason gas prices are creeping up has nothing to do with how much people are driving, it’s about higher production costs. This is called cost-push inflation. 

Each spring, refineries switch to summer-blend gasoline, which is cleaner-burning but more expensive to make. That raises costs for refiners, even if demand stays the same. Those higher costs don’t disappear, they move down the supply chain. By the time the fuel reaches your local gas station, prices at the pump are higher simply because it costs more to produce the gasoline. Higher input costs push prices up, even without extra demand. Yay…

Got questions about what’s going on with gas prices in your neck of the woods? Hit reply and let me know! Maybe your question will end up in an upcoming addition of CrudeIQ!

-Mark Acor, [email protected]