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Gas prices could reach more than $3.00, says economist at UAB

Gas pump still (abc 3340)
Gas pump still (abc 3340)
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Gas prices are skyrocketing right now and some experts say, they don’t see them slowing anytime soon.

UAB professor and Goodrich Endowed Chair for Innovation and Entrepreneurship Dr. Patrick J. Murphy says, oil and gas companies planned for a major lack of gas use during the pandemic.

“When we went into the pandemic, they were intentional about ramping the supply down,” Dr. Murphy said.

What he said they didn’t plan on, was so many drivers hitting the road again this early.

“Now they’re going to have to scramble to start raising that supply back up, but it doesn’t turn on a dime,” Dr. Murphy said.

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That means as we see more demand, people like driver Fuller Currie are likely going to see dramatically higher prices.

“It’s just another strain, really on the budget,” Currie said.

If you look back at gas prices for the month of March over the last three years, one gallon of regular gas costs more than an average of $ 2.00.

This year we are looking at about $2.50 per gallon in Birmingham.

In March of 2020, your average gallon of regular gas cost about $2.20 and in 2019 it was about $2.50.

As we move into warmer weather, Dr. Murphy says demand is only going to increase and it’s going to happen quickly.

“I wouldn’t be surprised if we went over $3.00. I don’t know about four, I wouldn’t be surprised if we had three and some change. It wouldn’t surprise me one bit,” Dr. Murphy said.

The good news according to Dr. Murphy, prices will fall again but only after supply can get back up.

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