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UND economist: Gas prices likely to increase, remain high until fall

UND economics professor David Flynn says we may need to wait until next year for any drastic drops.

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Gas price increases are attributed to many factors, such as the war in Ukraine and supply chain issues.
Matt Henson / WDAY News
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GRAND FORKS — It was another big punch to the wallet this week as some gas stations increased prices 30 cents a gallon.

The pain is real for Jackie Geske, who on Wednesday, May 12, filled up for the first time at more than $4 per gallon.

"I start thinking about maybe riding my bike," she said.

For Joshua Anderson, rising prices are literally trimming his wallet.

"I've gotta do what I've gotta do," he said.

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Anderson runs the lawn business We Mow Lawns. He's had to raise prices and uses the push mower more, when he can, than the riding mower because it uses less gas.

He's also made adjustments to how he transports his equipment.

"I've had to reduce to an SUV (pulling a trailer) instead of a truck. It's still better mileage than a truck without the trailer," he explained.

University of North Dakota economics professor David Flynn points to the Ukraine conflict and sanctions against Russia as a large factor. He also explained that unlike previous times when gas prices got really expensive and people would cut back, that's not the case this time due to the "COVID hangover" and that production can't meet demand.

"It's not just a switch that's flipped. It's not flipping the power switch and the lights come on. There's a lot of startup that goes into that, crews that go into that, and so it takes time for them to get going," said Flynn.

Skyrocketing gas prices have also become a political issue in the fact there's a push to release oil reserves.

"That's not enough. That's not nothing, but it really is a small amount of support within the even larger problematic situation, and so it may be keeping things from getting that much worse but it's not stopping the prices from rising," said Flynn.

He says as gas prices continue to rise expect to start paying those fuel costs for businesses you shop from too, as they will likely jack up their prices to offset their fuel costs. He projects prices will continue to rise slightly until the fall with an occasional dip.

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That means gas prices will be trimming money from Anderson's wallet all summer.

"Yeah, it sucks," he said.

Flynn says long range models indicate that gas prices may drop down to the mid $3 per gallon next year, but that depends on a lot of moving parts

Matt Henson is an Emmy award-winning reporter/photographer/editor for WDAY. Prior to joining WDAY in 2019, Matt was the main anchor at WDAZ in Grand Forks for four years. He was born and raised in the suburbs of Philadelphia and attended college at Lyndon State College in northern Vermont, where he was recognized twice nationally, including first place, by the National Academy for Arts and Science for television production. Matt enjoys being a voice for the little guy. He focuses on crimes and courts and investigative stories. Just as often, he shares tear-jerking stories and stories of accomplishment. Matt enjoys traveling to small towns across North Dakota and Minnesota to share their stories. He can be reached at mhenson@wday.com and at 610-639-9215. When he's not at work (rare) Matt resides in Moorhead and enjoys spending time with his daughter, golfing and attending Bison and Sioux games.
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