Long Island gas prices could hit record high this week, experts say

Gas prices could hit record highs this week and reach $5 a gallon soon, as uncertainty over the Russia-Ukraine conflict continues and consumer demand for fuel increases.

Long Island’s gas prices typically run 20 to 25 cents higher than the national average, and both the local and U.S. averages are poised this week to break record highs set in July 2008, experts said.

"I think we are at a new record nationally tomorrow. [Long Island will hit a record] maybe Wednesday, Thursday at the latest," Denton Cinquegrana, chief oil analyst at Oil Price Information Service based in Rockville, Maryland, said Monday.

The average price of a gallon of regular gas Monday was $4.065 nationally and $4.267 on Long Island, according to AAA.

Long Island’s all-time high was $4.346 on July 8, 2008, said Robert Sinclair Jr., spokesman in the Garden City office of AAA Northeast.

The sticker shock likely won’t be waning anytime soon.

"I never thought I’d say this but I gotta be honest. … I wouldn’t be surprised if we saw $5" per gallon nationally by mid-April, said Cinquegrana. Some stations on the Island were already charging close to that on Monday.

Long Islanders are feeling the effects of the rising pump prices.

Copiague resident Sergio Penagos, 34, has started walking to his job at a bagel shop, which is a few blocks from his home, in order to avoid driving his car, he said.

When he does drive, he tries to consolidate trips to cut costs as much as he can, especially since he sends money to his family in Colombia, he said.

"I can feel it. I can feel it in my pocket," he said of rising gas prices.

Amityville resident Lenny Houlker uses GasBuddy, an app that lists fuel prices at local gas stations for comparison, and he buys discounted gas at membership warehouse clubs Costco and BJ’s Wholesale Club to help save money, he said.

He also has cut out unnecessary driving.

"[I] go where I need to go. You know, try to keep it local as opposed to doing anything I really don’t need to do," said Houlker, 46, who said he is concerned about low-income people who have to cut into their budgets for groceries and other necessities to pay for gas.

Multiple factors driving increases

Several factors are at play in rising gas prices.

For one thing, U.S. gas prices have been rising for months, driven largely by tight supplies and the economic recovery from the COVID-19 pandemic, said Frank Macchiarola, senior vice president of policy, economics and regulatory affairs at the American Petroleum Institute, a Washington, D.C.-based trade association for the oil and natural gas industry.

Demand for crude oil, used in the production of gasoline, has been rising as more people return to driving vehicles for work and leisure, but supplies are lagging, which is leading to higher fuel prices, he said.

Russia’s Feb. 24 invasion of Ukraine is exacerbating the price increases.

Russia is the world’s third-largest oil producer. The European country produces more than 10 million barrels of oil daily, or about 10% of what the world uses daily, Macchiarola said. Last year, the U.S. received about 8% of its oil and other petroleum products from Russia, he said.

Since Russia’s invasion of Ukraine, U.S. refiners have largely ceased imports of Russian crude oil and refined products, making it likely that the amount of imports from Russia is at or near zero, he said.

Plus, the U.S. might ban oil imports from Russia, which could send prices higher.

"Prices generally fluctuate when there is uncertainty in the market," Macchiarola said.

Aside from the Russia-Ukraine conflict, other annual factors send gas prices rising in the spring and summer.

New York and some other states mandate that gas stations sell special summer blends of fuel, which have lower vapor pressure, during warmer months, but are more expensive because they are harder to refine, Sinclair said.

Also, 85% to 95% of summer vacation and holiday trips are made by car, which means that gas prices will rise with demand, he said.

Despite the rising prices on Long Island, the sticker shock might pale in comparison to what California drivers are seeing.

On Monday, the average price for a gallon of regular gas in California was $5.343, compared to $4.827 a week ago.

"California is a completely different animal," said Cinquegrana, who said that is due in part to the state having some of the toughest environmental standards in the world for its fuel, which makes it more expensive to produce.

"California ... has a couple of environmental programs that add to the cost and is passed onto the consumer," he said.

‘It doesn’t make any sense’

In Washington, there have been growing bipartisan calls to ban Russian oil imports, and White House officials have said the Biden Administration is actively weighing a ban alongside European allies.

Rep. Tom Suozzi (D-Glen Cove), a co-sponsor of bipartisan legislation to ban Russian oil and energy products, said he expected Congress would act on the legislation this week as it also considers a $10 million humanitarian relief package for Ukraine.

"It doesn't make any sense whatsoever that we are supporting this madman — Putin — and his economy to fund the murder of the Ukrainian people," Suozzi said at a virtual news conference Monday.

Suozzi, who is staging a Democratic bid for governor, acknowledged the concerns about soaring gas costs, but argued there are ways for state and federal officials to reduce some of those costs, including temporarily suspending the state gas tax.

"We need to cut [Russia] off," Suozzi said. "We understand that will disrupt the markets. We understand that will have an effect on pricing, but we have to all pull together and figure out how to combat that…releasing strategic oil reserves, increasing production in the U.S. and elsewhere, and cutting gas taxes are some of the ways that we can do that."

Gov. Kathy Hochul, asked about temporarily lifting the state gas tax, told reporters in Rochester on Monday that her office was examining the possibility but said there is no "guarantee" that suspending the tax will result in a major impact on the overall price at the pump.

"I want to make sure that if we do something, it's actually going to have an impact," Hochul said.