Gas prices shot up at a record-fast pace this week, jumping from a national average of $3.656 on March 2 to $4.318 on March 10.
A combination of ongoing inflation and President Joe Biden’s recent move to ban imports of Russian oil are to blame, experts say. Announcing the decision on Tuesday to implement further sanctions effective immediately, Biden said, “The decision today is not without cost here at home. Putin’s war is already hurting American families at the gas pump,” he said. “With this action, it’s going to go up further.”
That cost translates to stretched-thin budgets and more families living paycheck to paycheck as consumers are hit not only with higher prices at the pump, but also with higher prices across goods and services that rely on diesel-fuel truck and train transportation and higher travel prices as jet fuel costs also rise.
It’s typical for gas prices to rise in the summer months, but this sort of spike is highly unusual and experts predict costs will continue to rise in the coming months.
“Seasonality is part of the impact, from summer gasoline, but the bulk is still the Russia situation,” says Patrick De Haan, head of petroleum analysis for GasBuddy. “The risk, the possibility that there will be further disruption and escalation is being priced in. The U.S. does only obtain small amounts of crude oil and products from Russia, but it’s also a global commodity and U.S. sanctions have far-reaching effects on the ability for other countries to buy oil from Russia as well.”
Consumers can protect themselves from the worst of these rising prices by shopping around for the best gas prices, using a gas app, and taking other steps to cut costs from their budgets in anticipation of ongoing high fuel prices.
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Make Lifestyle Changes to Reduce Expenses
When one item on your budget increases, other items need to decrease. Consumers now need to budget for both high gas prices at the pump and rising prices across sectors, says Denton Cinquegrana, chief oil analyst at the Oil Price Information Service.
“Keep an eye on diesel,” Cinquegrana wrote in an email. “Crude oil and gasoline get all the headlines. But it’s diesel that moves the economy and prices there are skyrocketing more than gasoline. That means everything goes up in price, items on the shelves in grocery stores, big box retailers, malls … Fuel surcharges for trucking are going to be passed through to the consumer.”
Review your budget and look for opportunities to save money in other areas of spending to make up for increasing transportation costs. This might mean cutting back on discretionary spending to make room for a larger transportation budget this month or modifying your lifestyle to avoid bearing the brunt of current high gas prices.
[READ: How to Estimate Your Utility Costs.]
Gas prices are high and experts don’t anticipate a drop in prices, particularly as pandemic cases in the U.S. subside and the warm summer months near. Take public transportation whenever possible, carpool with friends and avoid planning road trips or booking flights for the next few months. Consider working from home instead of fueling up for a long commute to and from work, if possible.
Consider joining a warehouse club like Costco, Sam’s Club, or BJ’s Wholesale Club to take advantage of discounted bulk goods and members-only gas stations that often offer lower prices compared to other stations in a given area.
“Your budget is a living tool that should change due to a variety of financial priorities or influences,” Thomas Racca, manager on the personal finance management team at Navy Federal Credit Union, wrote in an email. “Start by looking at any areas where there might be room to cut back. For example, if there’s a streaming service you don’t use frequently, cancel your subscription for a short while. Or, commit to making more food at home and going out to eat less. These small adjustments can help make up the added financial burden that gas will have.”
Save Money on Gas at the Pump
From station to station, prices will vary. Save your budget a few extra bucks by shopping around for the cheapest gas in town. You can accomplish this by taking a quick drive around or by downloading a gas app.
Most gas apps work by asking users to input their ZIP code, then displaying user-provided gas prices at various stations in that region and directions to the nearest gas stations. Popular gas apps include GasBuddy, Gas Guru and AAA TripTik Travel Planner.
[Read: How Retirees Can Cope With Inflation]
Some gas stations offer rewards and loyalty programs that can help you meet your budget goals at the end of the month. Exxon Mobil Rewards+ and Shell Fuel Rewards are two popular options, which each offer savings at a rate of 3 cents per gallon.
Others offer discounts to customers who pay in cash. While it may be inconvenient, if it saves you money at the pump, now is the time to give this budget-saving strategy a try.
Lastly, make sure your vehicle is well maintained to get the best gas mileage possible.
Check the tire pressure, replace spark plugs and check the alignment on your car to save money on gas, and drive more slowly to avoid wasting gas on sudden accelerations or breaking. Even try taking items out of your trunk to reduce the weight in your vehicle.
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How to Budget for Rising Gas Prices originally appeared on usnews.com
