The National Averages Drop Below Year-Ago Levels
TAMPA, Fla.— Gas prices are falling fast after oil prices suffered big losses last week. The national average price for gasoline dropped for the 9th consecutive day on Sunday, falling a total of 4 cents since June 2. On Friday, the average price dropped below year-ago levels for the first time in 204 days.
The national average price for a gallon of regular unleaded was $2.34 on Sunday, according to AAA, whose data is collected from credit card swipes and direct feeds from 120,000 gas stations nationwide, in cooperation with OPIS and Wright Express. Sunday’s national average was 4 cents less than both last week and this time last year.
“Unexpected growth in oil and gasoline supplies sent prices into a downward spiral,” said Mark Jenkins, spokesman, AAA – The Auto Club Group. “Oil prices plunged to lows that should translate to a total discount of 5-10 cents at the pump, but motorists shouldn’t expect that discount to hit overnight. It usually takes a week or two before gas prices fully adjust to major shifts on the crude oil market.”
Last month, OPEC extended production cuts in hopes of balancing the oil market. Yet it appears the market glut is getting worse, according to the latest supply data from the government (EIA), thanks in large part to increased production in the United States. Crude inventories unexpectedly rose for the first time in nine weeks, increasing 3.3 million barrels per day to a total of 513.2 million barrels. Meanwhile, gasoline stocks grew for the first time in five weeks, by nearly 3 million barrels. Both stock levels are well above last year’s levels.
All this growth, combined with weaker demand figures, pushed oil prices to their lowest point in five weeks. Thursday’s daily settlement of $45.64 was the lowest since May 4, 2017. The weekly average of $46.56 was the lowest since November 2016. Oil prices have fallen $4 since Labor Day weekend.
*Highs and Lows of 2017*
The highest national average price for gasoline, so far this year, is $2.42 on April 21; the lowest is $2.26 on February 9.
(Based on weekly data provided by the EIA for the week ending 6/2/2017)
Crude oil prices hit 5-week lows last week, settling at $45.64 on Thursday. The weekly average of $46.56 was the lowest since November 18, 2016.
U.S. crude inventories increased for the first time in 9 weeks by 3.3 million barrels
Domestic crude production sagged 0.26%; remains 6% higher than year-ago levels
Refineries let off the accelerator after churning out high levels of product, but remain nearly 6% more efficient than year-ago
Wholesale gasoline dropped for the third consecutive week, falling 4 cents during the past week.
Domestic gasoline production rose 0.7% at Gulf Coast refineries; nearly 3% more than year-ago levels
Gasoline supplies swelled by 1.4% domestically and 1% in the Gulf Coast. Stocks are now in line with last year’s levels; nearly 10% more than 2 years ago.
Gasoline demand softened last week, falling 5.42% from the record high set the week before.
Gas Price Survey Methodology
AAA updates fuel price averages daily at http://www.GasPrices.AAA.com. Every day up to 120,000 stations are surveyed based on credit card swipes and direct feeds in cooperation with the Oil Price Information Service (OPIS) and Wright Express for unmatched statistical reliability. All average retail prices in this report are for a gallon of regular, unleaded gasoline.
About The Auto Club Group
The Auto Club Group (ACG) is the second largest AAA club in North America. ACG and its affiliates provide membership, insurance, financial services and travel offerings to over 9 million members across eleven states and two U.S. territories including Florida, Georgia, Iowa, Michigan, Nebraska, North Dakota, Tennessee, Wisconsin, Puerto Rico and the U.S. Virgin Islands; most of Illinois and Minnesota; and a portion of Indiana. ACG belongs to the national AAA federation with more than 57 million members in the United States and Canada and whose mission includes protecting and advancing freedom of mobility and improving traffic safety. Motorists can map a route, identify gas prices, find discounts, book a hotel, and access AAA roadside assistance with the AAA Mobile app for iPhone, iPad and Android. Learn more at AAA.com/mobile. AAA clubs can be visited on the Internet at AAA.com.