Slight relief at the pumps as gas prices begin to decrease amid inflation

Grand Prairie resident Travon Erwin, 30, fills up his Dodge Challenger at a gas station on July 18 in Grand Prairie. His tank averages $85 to fill, but it used to cost only $45-50.

International business senior Alejandra Romero does not let the current gas prices hinder her commute. Before the price increase, she spent about $30 on gas, she said. Now she spends anywhere from $30 to $50.

“It’s really inconvenient,” she said. “Just because where I work, I don’t really make that much so I end up having to ask my parents for gas money a lot.”

The consumer price index rose to 9.1% in June, increasing by 1.3% for all items this month alone, according to the U.S. Bureau of Labor Statistics. However, gas prices have slowly decreased in the last month. The new average cost of gas in Texas is $3.78 compared to $3.99 in March, according to the American Automobile Association and GasBuddy’s gas prices data.

“Gas prices are coming down so that’s a good thing,” Romero said. “I feel like maybe the government is doing its job to help people.”

Inflation is the rise of prices of goods and services, marketing associate professor Narayanan Janakiraman said. A small bit of inflation is expected in a growing economy or proceeding market. In this case, the United States and other parts of the world are experiencing an increase in prices that are higher than normal.

Even though there is no established acceptable level of inflation in the United States, policymakers believe it is around 2% or less, according to the Federal Reserve's website.

There are multiple causes of inflation pertaining to supply and demand, he said. The supply is what manufacturers send out and the demand is what consumers ask for.

One reason is demand has outpaced supply and caused prices to rise. Another reason is that there is a shortage of goods being produced for the consumer.

Janakiraman speculated that the war on Ukraine has lowered gas availability, which caused its price to increase. Another reason, he said, is the effect of lifting COVID-19 lockdowns. As people returned to work, the demand for gas increased because there were more cars on the road.

Ann Foss, city of Arlington principal planner for the Department of Transportation, said Via Arlington has seen an increase of ridership over the past few months.

The rideshare program launched in December 2017 in response to a growing need for transportation in the community, Foss said. Via has 68 six-passenger vans transporting residents across the city.

Even though the increase of gas prices may be a factor, Via has expanded to cover the whole city of Arlington in January 2021, she said.

According to the U.S. Energy Information Administration, gasoline prices increase when the supply decreases. Historically, prices tend to rise during the summer months since more people travel during that time, which increases the demand.

Janakiraman said his advice to others when it comes to spending is to be selective of what to spend on and when. 

“If you read most of these economists and others who predict this market, they're hoping that by early next year, we should see prices be lower than what they are right now," he said.

@TaylorAC13

news-editor.shorthorn@uta.edu

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