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Why Is Gas So Expensive Again?

Gas prices haven’t come down since Labor Day. Here’s why


spinner image A customer walks by a gas station sign  that says Funace Creek Fuel, where fuel prices above $5 and $6 per gallon.
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Gas prices normally decline after Labor Day, but instead, they are rising. Production cuts by Saudi Arabia, Russia and other oil-producing countries, as well as natural catastrophes such as the floods in Libya, are driving prices higher at the pump. How much? On Monday, the national average for regular gas reached $3.88 a gallon, according to AAA. That’s the highest price since October 2022. Since last week, gas prices are 5 cents a gallon higher. 

“Normally prices slide gradually through the summer as we approach the fall. The uptick we’ve seen recently is certainly not normal,” says Mark Schieldrop, a spokesman for AAA Northeast. ​

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Why are gas prices high? 

1. The heat. Heat waves across the South this summer have had a major impact on gas prices. The hot weather in Texas, Louisiana and along the rest of the Gulf Coast has affected oil refineries, hurting their production. Though these big refineries can handle extreme weather, they were not designed to operate at full capacity for extended periods with temperatures near or above 100 degrees. This summer, there have been four or five refinery outages due to excessive heat, says Patrick De Haan, head of petroleum analysis at GasBuddy. 

Then there are the devastating floods in Libya, an oil-producing nation. It produced 1.16 million barrels a day in August, according to the International Energy Agency.

2. Foreign producers. In June, Saudi Arabia and some other oil-producing countries agreed to slash production to drive up prices. Those cuts, which were initially forecast to last through August, have been extended to September. That means 1.5 million fewer barrels of oil a day is being produced. A lower supply means higher prices, Schieldrop says. When the production cut was announced, oil was selling at about $70 a barrel, and since then the price has jumped to more than $93 a barrel.

3. Demand. Add a big jump in demand, which experts say was unexpected, to the mix, and you can see why gas prices are elevated. ​

When will prices come down? 

​When it comes to forecasting gas prices, there are a lot of unknowns. For starters, we are in hurricane season. One bad storm that disrupts oil production can cause gas prices to surge. And if those oil-producing countries decide to continue to cut production, it can also drive prices higher. Barring the occurrence of one of these unknowns, though, experts say prices should go down soon and the declines should last through November. During the fall, demand eases as summer vacations end and the industry switches to a winter mix of gasoline, which is cheaper to produce. ​

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How can you save? 

One of the best ways to save money on gas can be the hardest to accomplish: changing your driving habits. Speeding, heavy braking and other kinds of aggressive driving use a lot of gas. “Every time you touch the brake pedal, you’re wasting fuel,” Schieldrop says. “If someone is an aggressive driver and slows down, they can save 20 to 30 percent.” Driving less, running your errands when you are commuting, and planning your outings to be more efficient can also go a long way toward curbing your gas outlays as well.​

Maintaining your vehicle and making sure your tires are properly inflated can also reduce the amount of gas you use. 

It’s also a good idea to shop around for your gas, as prices can vary from one station to the next. Location tends to matter a lot. If a gas station is on a highway, you’ll likely pay more there than you would at your local filling station. Warehouse retailers, including Costco and BJ’s, offer reduced fuel prices at the pump to members. There are also several gas comparison apps you can download to find fuel bargains. “I’ve learned people don’t change their driving habits,” says De Haan. “Look at the price you are paying at the pump and always go where it’s cheapest.”

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