The violence in Libya is leading to a spike in oil prices which may quickly translate to higher pump prices in Iowa. Libya is the world’s 18th largest oil producer and also sits atop the biggest oil reserves in Africa. Triple-A spokesman Tom Crosby says crude oil prices are rising for a couple of reasons.
“Right now, we have some issues with the refineries,” Crosby says. “Some of them have cut down production a bit to get ready for the summer months and we also have the unrest in the Middle East. Typically, this is the time of year when the prices climb upward.” Gasoline prices in Iowa are now averaging three-21 a gallon, which is four cents higher than the national average. Crosby says he wouldn’t expect gas prices to jump much further.
“We have plenty of inventory,” he says, “and hopefully, once the refineries get back online around the middle of April, we should start seeing some price abatement.” Crosby says the approaching spring and summer travel season will likely push gas prices higher as demand rises.
“How strong that effect will be will also depend on how well the economy is recovering,” he says. “People that are working, we’ve gone through these run-ups in gas prices before. It’ll all depend on how comfortable people feel paying that extra money for gas, how well their job is, etcetera.”
Global oil prices rose about 7% on Tuesday. Triple-A says Iowa’s current statewide average price of $3.21 a gallon is 62-cents higher than a year ago.