The average price of regular-grade gasoline in the U.S. rose 7 cents a gallon over the past two weeks to $2.90, the 10th week straight of increases.
Industry analyst Trilby Lundberg of the Lundberg Survey said Sunday that the jump marks the highest average price since November 2014, the Associated Press reported.
Lundberg says the increase is largely driven by higher crude oil costs and the phasing-in of summer-grade gasoline, which is used to prevent smog.
The highest average price in the contiguous 48 states was $3.73 in the San Francisco Bay Area. The lowest was $2.45 in Baton Rouge, Louisiana. The average price for diesel fuel rose 5 cents, to $3.14.
The $2.90 a gallon higher than the previous month's U.S. average, GasBuddy.com told CBS News as some experts think most of the country will soon hit $3 a gallon at the pump.
"At the pump, the national average is poised to rise in the week ahead, following oil's upward move Monday, awaiting President Trump's decision on Iran," Patrick DeHaan, head of petroleum analysis at Gasbuddy.com, stated in an email, CBS reported.
"The harsher the comments from the President, the more oil prices may rally, while a softer tone may lead oil to give up some of the recent gains. Gas prices will eventually follow in the weeks following, whichever way oil moves."
Higher oil prices translate to increased costs at the gas pump for U.S. households and businesses, CBS explained. They can also stoke fears of inflation. For every penny the price of gas increases, it costs consumers about $4 million a day. That equates to $1.4 billion a year, DeHaan has told CBS.
Already, 13 percent of gasoline stations across the country have prices above $3 a gallon, USA Today reported, citing AAA.
Gasoline prices tend to be highest on the West Coast, and nine states — Alaska, California, Hawaii, Idaho, Nevada, Oregon, Pennsylvania, Utah and Washington — already have averages above the $3 mark, USA Today reported.
Stock market investors have hoped that the tax cuts enacted at the end of 2017 would put more money in consumers' pockets, leading to stronger levels of economic activity. But paying more at the pump could leave less for ordinary Americans to spend on other things, potentially weighing on economic growth.
Meanwhile, oil prices rose for the fourth straight session on Monday to hit levels not seen since late 2014, boosted by the latest trouble for Venezuelan oil company PDVSA and the possibility that the United States could re-impose sanctions on Iran, Reuters explained.
U.S. West Texas Intermediate (WTI) crude futures rose $1.01, or 1.5 percent, to settle at $70.73 a barrel. This was the first time since November 2014 that WTI had climbed above $70. Brent crude futures jumped $1.30, or 1.7 percent, to settle at $76.17 a barrel.
U.S. President Donald Trump said a decision on whether to remain in the Iran nuclear deal or to impose sanctions would be announced at 2 p.m. EDT on Tuesday, four days earlier than expected.
“I think it’s a sign that he’s planning on reimposing sanctions, and the only question for oil markets is how soon,” said Joe McMonigle, an energy analyst at Hedgeye Research. “I think they would as quickly as possible try to implement the sanctions.”
The agreement has a dispute resolution clause that provides at least 35 days to consider a claim that any party has violated its terms. That can be extended if all parties agree.
If Trump restores core U.S. sanctions, under U.S. law he must wait at least 180 days before imposing their furthest-reaching measure: targeting banks of nations that fail to significantly cut their purchases of Iranian oil.
Analysts at RBC Capital Markets said Iran’s exports could be cut by 200,000 to 300,000 bpd as a result. Iranian officials, however, said that the country’s oil industry would continue to develop even if the United States pulls out of the accord.
(Newsmax wire services contributed to this report).
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