Runup in gas prices exceeds price impact of ’73 oil embargo
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There was another big jump in gasoline prices overnight in Minnesota when gas stations raised the price of gasoline by another 20 cents a gallon, to $4.39 at most major outlets. That's on top of the 50 cents-a-gallon increase over the last week and a half.
Since January's low, gasoline prices have jumped 55 percent in the Twin Cities.
How does this compare to the big price shock of 1973 when the Arab oil embargo hit the United States and many stations ran out of gasoline?
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The average price of a gallon of gasoline in May 1973 was 38.5 cents a gallons ($1.96 in 2012 dollars). By June 1974, it had risen to 55 cents or $2.53 a gallon in '12 dollars.
In 1974, that was a 42-percent increase, far less than the current increase and that's for a situation in which there was no gas to sell. The current run-up is being blamed on just two refineries in Illinois that were closed for maintenance.
WCCO's Jason DeRusha pointed out this week that part of the reason for the increase is the gasoline refined in Minnesota was sent to Chicago to compensate for the closed refineries. As of today, the average price of gasoline in Chicago is falling.
(Photo: Associated Press)
