Gas prices in San Antonio are the highest they’ve ever been, and as they continue to climb experts say they’re unlikely to significantly come down anytime soon.
The average price in San Antonio was $4.52 per gallon, according to AAA Texas; diesel is averaging $5.11.
Fuel prices have been rising steadily since the middle of April and gasoline prices are up about 64% from the beginning of June last year, according to AAA Texas.
Put in more concrete terms, a round-trip drive to Austin in the Ford F-150, Texas’ most popular used vehicle, would cost around $31 in gas today. One year ago, that same trip would have cost about $17.72.
The rocketing cost of fuel has funneled many price-shopping drivers to a gas station in Northeast San Antonio, the K&P Food Store at 4802 Rittiman Rd., which GasBuddy.com lists as the cheapest gas in the city, and where a price sign for $4.09 hangs out front. But the convenience store’s pumps have plastic bags over them; the store hasn’t sold gas in three weeks, said a worker at the store who identified himself only as Joe. “I’m waiting for the price to come down.”
Prices in Texas are lower than the nationwide average, which is $4.96, the highest price ever recorded by AAA.
A number of factors are responsible for the record price surges, but all boil down to supply and demand.
On the supply side: Russia’s invasion of Ukraine prompted U.S. leaders to declare a ban on all Russian oil imports, and European Union leaders to pull back significantly from the Russian supplies their countries have historically depended on. While the United States was never a big consumer of Russian oil — San Antonio’s Valero was the biggest importer, but even for them it was around one-eighth of its supply — the European Union has long relied on Russian oil, so the bans have sent many European countries to look elsewhere. And the global nature of the oil market means that disruptions anywhere tend to constrain supply everywhere.
U.S. oil producers have been sluggish to respond, said Thomas Tunstall, director of research at UTSA’s Institute for Economic Development, as their shareholders have pressured them to spend profits on stock buybacks and higher dividends instead of capital investments that would expand drilling. A quarterly report from the Payne Institute of Public Policy at the Colorado School of Mines, a geology-focused institute, found that because of this, production growth through 2022 “likely remains modest.”
Despite this lessened supply, demand is still strong. The summer travel season has started, and Tunstall said many households may be reluctant to cancel plans. One indicator of this is air travel. Even as jet fuel prices partly drive a surge in airfares above pre-pandemic levels, all U.S. airlines report strong bookings for summer travel.
“Prices will likely continue to fluctuate, with relief likely not coming until after the busy summer travel season concludes,” said AAA Texas spokesman Daniel Armbruster in a prepared statement.
Tunstall said he doesn’t expect to see significant relief from gas prices until the end of summer at the earliest, as any fixes will take time.
“Sooner or later, there will be ripple effects,” he said, such as consumers buying fewer trucks and more gas-efficient vehicles. That happened in the 2000s, when gas prices were on the rise, but the effect faded quickly when prices fell. Tunstall said any long-lasting change to consumer behavior would likely only happen if gas prices remained high for far longer.
Back in March, AAA warned that surveys showed $4 a gallon was the “tipping point” at which drivers may begin to cut back on driving. With prices having surpassed the $4 threshold, it could spell trouble for San Antonio’s downtown tourism industry, which takes much of its money in from regional travelers driving in.