President Biden recently posted on Twitter that, “Oil prices are decreasing, gas prices should too.” He went on to explain how oil and gas companies profit from the high prices of gas.

This does, however, beg the question: how did we get here? Florida’s gas prices are averaging around $4.20 per gallon, but some states like California and Hawaii have reached over $5.

One reason for the high prices is the increased demand for gas following the pandemic. As people continue to return to their jobs after previously working from home, it causes a demand for gas that markets had not seen since March and April of 2020. In those months, gas prices plunged to a national average of $1.94. The readjustment that stems from life after the pandemic makes gas markets unprepared for the sudden demand for gas, thus the cost.

Another reason for the prices is the supply aspect of supply and demand. The pandemic caused major oil producers like Russia to cut oil production by almost 10%. This worked during the pandemic, but until July of 2021, they kept it that way. It was essentially the butterfly effect of cutting production then, which crucified the prices now.

Lastly, and most recently, the Russo-Ukrainian war caused President Biden to place sanctions on imports from Russia, including oil. Though the U.S. imports less than 10% of Russian oil, the sanctions put a damper in the world oil market, which affect exports, thus affecting price.

The week of March 4, 2022, the U.S. produced 11.6 million barrels of oil per day compared to 11.3 million per day in March of 2020. More oil is being produced, so the halting of the pipeline does not have a disastrous effect on production.

Predictions for the gas prices to return to normal as supply and demand begins to even itself out again. Once America begins to adapt to accommodate the effects of the huge historical events – the pandemic and the Russo-Ukrainian War – the gas prices should soon be a recipient of the accommodations.