Aug 2, 2023 - Economy & Business

The heat wave is driving up gas prices

Data: AAA; Chart: Axios Visuals
Data: AAA; Chart: Axios Visuals

Gas prices ticked up 15 cents in just the past week, as the heat wave hitting Texas and Louisiana slowed oil refineries down.

Why it matters: The nation's mood runs on gas prices — when they're high, economic vibes worsen. And, rising energy prices keep inflation levels elevated, complicating the Fed's efforts to rein in higher prices.

Zoom in: Refineries, which turn crude oil into products like gasoline, don't function as efficiently in 100+ degree weather.

  • Meanwhile, demand for gas typically rises in the summer, and gasoline inventories in the U.S. are at their lowest July level since 2015, Patrick De Haan, head of petroleum analysis at GasBuddy, said in a note.

Yes, but: Prices are still nowhere near the high levels we saw last summer.

What to watch: Hurricane season. Severe weather could also impact refineries and push up prices.

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