The Limited Times

Now you can see non-English news...

The rise in the price of gasoline will make "all corners of the economy more expensive," experts warn

2021-10-12T00:26:41.429Z

The cost of food will continue to rise, as will utilities and transportation. "This is going to become a big problem during the winter" and will not improve until 2023, warned an analyst.



By Martha C. White -

NBC News

Gasoline prices continue to rise, but it is not the only thing that will be on the rise in the coming weeks.

Energy industry analysts and supply chain experts

warn that consumers will also experience an increase in the cost of electric power. 

Oil surpassed the $ 80 mark, while energy crises in China and parts of Europe make it more likely that fuel costs will rise during the winter. 

[Food and gasoline prices continue to rise.

What causes this rise?]

The median price of a gallon of regular gas was $ 3.27 on Monday, according to the American Automobile Association (AAA) 

, an increase of 7 cents in just one week.

Experts say rising fuel prices will affect energy prices Cade Peter / Getty Images

"We expect the median price of gasoline to hit $ 3.50, just because of what's happened in the last two weeks," said Jay Hatfield, CEO and portfolio manager at

Infrastructure Capital Advisors.

On Monday, US crude rose

1.5% to $ 80.52 a barrel, closing above $ 80 for the first time since late 2014

and raising its rise since late October to 125%. 

Tom Kloza, Global Head of Energy Analysis at

OPIS by IHSMarkit

, said "every corner of the economy" could be affected.

"Everything that moves tends to move across the country by truck or by train, so a more expensive year awaits us," he added.

“The increase in the price of oil has multiple collateral effects.

It is the basis for all transportation costs.

Jet fuel is the main factor influencing air freight transport, as well as the price of travel tickets, ”said Rob Handfield, professor of supply chain management and director of the Cooperativa de Recursos de la Supply Chain from North Carolina State University. 

[These are the states where gasoline is most expensive this Memorial Day weekend]

For his part, Stewart Glickman, an energy securities analyst at

CFRA Research

, said that rising fuel costs will inevitably lead to higher prices.

On video: Fights and long lines in the UK over fuel shortages

Sept.

27, 202100: 30

"It is a kind of hidden tax for consumers," he said. 

Kloza also said citizens will notice the impact in the form of higher utility bills this winter,

predicting that the price of natural gas - the source of about a third of the country's electricity - could double.

 “I think the heating bills are going to be quite high this winter.

If it's warmer than normal, great.

If not, prices will be quite high and there could be increases in natural gas, and Diesel, "he said.

"This is going to become a big problem in the winter, and that's assuming things don't get worse," Hatfield said.

[Food and clothing prices rise due to product shortages]

In Europe, natural gas prices have skyrocketed.

If the price of oil were equivalent, according to Hatfield, it would be $ 240 a barrel, about three times its current price. 

"In the United States, natural gas is still relatively cheap, so there is enormous pressure for our natural gas prices to go up," he said. 

This is the cause behind the food shortages in school cafeterias in America.

Oct. 1, 202101: 40

Fossil fuels and their derived products are a fundamental part of our daily consumption habits.

"

Rising oil prices have a trickle-down effect that affects all other industries," Handfield said.

Experts say that food prices could face triple inflationary pressure: in addition to the higher costs of shipping products to stores, agriculture relies on fossil fuels for the production of fertilizers, which means that the Increased costs of crops or animal feed could impact consumers in the form of higher food prices.

Food transportation would be affected which could cause a rise in prices David Paul Morris / Bloomberg via Getty Images

Food packaging is also affected.

Plastic granules called resins, which are the main component of many types of plastic bags, films, and other packaging materials, are derived from petroleum.

Production of these materials was already limited by the deep frost last winter in Texas, which pushed prices up.

"It's what I would call the perfect storm," Handfield added.

"I don't think we will see any relief until 2023. This is not a short-term disorder: it is a troublesome issue that is not going to go away for a while."


Source: telemundo

All news articles on 2021-10-12

You may like

Trends 24h

Latest

© Communities 2019 - Privacy