A lower oil price is causing pump prices to fall, with the national average for a gallon of regular gasoline dropping a nickel since last week to hit $3.63.
“The national average reached $3.68 last week, and that might be the peak price for now,” said Andrew Gross, AAA spokesperson. “As long as the oil cost keeps wobbling around the low to mid $70s per barrel, drivers will benefit when they fuel up.”
According to new data from the Energy Information Administration (EIA), gas demand increased significantly from 8.52 to 9.51 million b/d last week. The spike in demand surprised market observers, but the estimate could be revised when EIA releases final demand measurements for April. Meanwhile, total domestic gasoline stocks decreased by 2.4 million bbl to 221.1 million bbl. Higher demand, alongside a decline in stocks, would typically push pump prices up; however, fluctuating oil prices have pushed them lower. If oil prices continue to decline, pump prices will likely follow suit.
Today’s national average of $3.63 is 20 cents more than a month ago but 50 cents less than a year ago.
Quick Stats
Since last Thursday, these 10 states have seen the largest decreases in their averages: Michigan (−12 cents), Ohio (−11 cents), Texas (−11 cents), Indiana (−10 cents), Iowa (−10 cents), North Carolina (−9 cents), Tennessee (−9 cents), South Carolina (−8 cents), Wisconsin (−8 cents) and Nebraska (−8 cents).
The nation’s top 10 least expensive markets: Mississippi ($3.11), Arkansas ($3.22), Louisiana ($3.22), Texas ($3.23), Alabama ($3.23), Tennessee ($3.27), South Carolina ($3.29), Oklahoma ($3.32), Georgia ($3.34) and Missouri ($3.35).
Oil Market Dynamics
At the close of Wednesday’s formal trading session, WTI decreased by $2.77 to settle at $74.30. Oil prices fell yesterday amid ongoing market concerns that low consumer confidence could contribute to a recession this year. If a recession occurs, oil demand and prices will likely decline. Additionally, the EIA reported that total domestic commercial crude inventories decreased by 5.1 million bbl to 460.9 million bbl last week.
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