Why did gas prices surge? Miami Valley might hit $4 per gallon in May/June
Apr. 6—A combination of the summer gasoline transition, typical Ohio price cycling, and international cuts to oil exports mean gas prices in the Dayton area have jumped nearly 50 cents a gallon this week.
The Dayton area hit a low of $3.13 per gallon March 27, before jumping to an average of $3.41 at the end of the month, data from GasBuddy show.
The beginning of this week saw another increase of about 15 cents per gallon, with many area gas stations now charging $3.75. The Dayton area average Thursday morning was $3.62, and by late afternoon it was $3.67. This week Ohio has jumped above the national average, which sat at $3.54 a gallon late Thursday, according to GasBuddy.
The dramatic spike is caused by a few different factors. One is the transition to summer gasoline, which typically runs more expensive.
Ohio gas stations and stations along the Great Lakes typically do "price cycling," where they will continually undercut their competitors every few days, consistently lowering their prices by a few cents, said Patrick De Haan, head of petroleum analysis at GasBuddy.
"Inevitably though, when they have lowered prices too far, when stations are starting to sell gasoline at cost, they will restore their profit margin. And that's generally when prices will go up anywhere from 25 to 35 cents a gallon," De Haan said.
Two stations at the same Kettering intersection gave an example of the rapid changes Tuesday, as the Shell station at Stroop Road first raised its price to $3.75. The BP across the street stayed at $3.35 for awhile, then hours later matched its competitor at $3.75.
Additionally, the Organization of the Petroleum Exporting Countries announced cuts over the weekend that pushed up the cost of a gallon of gas for Americans. Saudi Arabia and other OPEC oil producers announced on Sunday they would further slash oil output of around 1.16 million barrels per day. Russian deputy prime minister Alexander Novak cited the Western banking crisis as reason for the cut, as well as "interference with market dynamics," or American price caps on Russian oil, Reuters reported Monday.
OPEC's decision came in the middle of the gas station price cycle, as distributors are restoring their profit margins, De Haan said, adding that it's "a big bite," for consumers.
Prices may start to go down by the weekend, De Haan said.
"If you're not in a rush to fill, if every station's at $3.75, try and hold off, because we could see prices at some stations back below $3.70 a gallon," he said.
Conversely, if you can find gas lower than that, now's the time to fill up. According to DaytonGasPrices.com, there were still a handful of stations across the region selling gas for $3.29 or less Thursday afternoon.
Ohio gas prices are projected to inch toward $4 a gallon heading into the summer. However, prices may come down after Memorial Day, as the Cynovus refinery in Toledo, formerly owned by BP, is scheduled to reopen in May.
The refinery was shut down in September 2022 after a fire killed two employees, and subsequently sold to Cynovus last year.
"Absent some major developments, I'm hopeful that gas prices may not hit $4 in Dayton. "If we do hit $4 it might happen between mid-May and mid-June," De Haan said.
