05/15/18 — U.S. leaves Iran deal, local gas prices spike

View Archive

U.S. leaves Iran deal, local gas prices spike

By Melinda Harrell
Published in News on May 15, 2018 9:36 AM

Full Size


Drivers get gas at the Kangaroo Express at the intersection of Spence Avenue and Mall Road Monday around lunchtime. Prices at the pump have jumped 6 cents nationally in the last week; locally prices are up 3 cents over the previous week and up 50 cents over this period a year ago.

As gas prices climb to $2.80 a gallon in Wayne County, AAA Carolinas says the jump is in part caused by President Donald Trump's decision to leave the Iran deal.

In the week the president decided to re-impose sanctions on Iran and to withdraw from the Iran Nuclear Deal, the national gas price average jumped 6 cents, according to an AAA Carolinas press release.

North Carolina's average, $2.70 per gallon, is up 3 cents from last week and 50 cents more than a year ago, AAA reports.

"The administration's move combined with the switchover to summer blend, growing global demand and shrinking supply continues to fuel pump prices as we approach the summer driving season," said Tiffany Wright, AAA Carolinas spokesperson.

"If crude oil prices continue to increase, the national average could reach $3, but it's still too early to tell how high prices will go in the Carolinas."

Wright said the Iran Nuclear Deal lifted sanctions on the country's ability to export and sell its crude oil supply. With the U.S. pulling out of the deal, exports are expected to decline and contribute to the already short supply of gasoline.

"It kind of put a limit on their ability to sell oil, so when 2015 rolled around they went into the agreement, and we have been reaping the benefits of it," Wright said.

"Iran is an oil powerhouse, and when you are talking about sanctions on oil exports, that is something us in America are going to feel at the gas pumps."

Though the decision to impose sanctions on Iran has led to an uncertain energy market in the nation, in North Carolina the unseasonably warm weather has also contributed to the supply crunch.

Wright said demand never went down over the winter because of the increased temperatures.

"We had an unseasonably warm winter when temperatures stayed high into October," Wright said.

Wright said people continued making travel plans as the weather was warm, carrying into early November.

"As we head into the spring, typically prices do go up because we begin to a more expensive gas blend," Wright said.

"The summer blend prevents evaporation and is better."

She said that prices typically reach their peak in early May and start settling down during the summer months.

"What we haven't seen in years, however, is prices may not be reaching their peak," she said.

"Gas prices are a rollercoaster right now."

In front of the Memorial Day holiday, gas prices typically do spike due to high demand.

Locally, gas prices range from $2.59 to $2.79. Compared to other cities in the state, prices are on par.

"It's going to be a busy summer travel season," Wright said.

"Will gas prices make some families pause and not take that trip? I don't know. What we typically see is people not canceling their plans and cutting something else."

Nationally, motorists are seeing gas prices 16 cents more expensive than a month ago and 53 cents more compared to prices a year ago.

Increased gas prices have also been reported in New England states, South Carolina, New Jersey, Texas and Michigan.