Banaian: 2 Things Could Drive the Gas Price Down
Gas prices in the St. Cloud area range largely from $4.19 to $4.34 as of Wednesday night. The possibility of seeing gas prices reaching $5,00 a gallon is very real this summer. St. Cloud State Dean, School of Public Affairs and Economics professor King Banaian joined me on WJON. He says $5,00 a gallon gas could happen this summer.
Banaian offered two possibilities to reduce the price at the pump. The first would be a recession which he says some experts could still happen in the short term. Banaian says it's tough to have a recession when we have an unemployment rate of 3.5% in Minnesota. He says a more likely scenario to reduce gas prices may be happening already and that is increased exploration. Banaian says the amount of rigs set up to explore for more oil has increased sharply. He says despite this pursuit it still would take approximately a year to year and a half for that new oil to come onboard. Ultimately gas prices dropping anytime soon is unlikely.
I asked Banaian if he thinks the gas prices will change what Central Minnesotans will do with their summer activities. He says people during the pandemic saved money so as much as these increased gas prices are troublesome it won't likely change people's travel plans for this summer.
If you'd like to listen to my conversation with King Banaian it is available below.