Today’s national average price for regular unleaded gasoline marks the lowest price for this date since 2004, and prices continue to march lower. The national average has dropped for 35 consecutive days for a total savings of 38 cents per gallon over this span. Today’s average price of $2.29 per gallon represents a weekly savings of four cents per gallon and a monthly savings of 33 cents per gallon. Motorists are saving $1.05 per gallon compared to one year ago, largely due to the relatively low price of crude oil and abundant petroleum supplies.
In addition to the seasonal switchover to less expensive winter-blend gasoline, the fall months are also a time when refineries go offline to conduct seasonal maintenance. This is intentionally scheduled during the months when demand for gasoline and heating oil is relatively low, and it is not uncommon for pump prices to decline during this time of year due to decreased driving demand and the cost savings associated with winter-blend gasoline.
This past summer was characterized by relatively high driving demand and refineries operated at higher capacities for longer periods of time. As a result, many are expecting the fall maintenance season to be heavier-than-usual. Barring any unexpected spikes in the price of crude, retail averages are not expected to climb this fall due to the market’s current oversupply.
The majority of consumers nationwide are continuing to see falling prices at the pump. Alaska ($3.13), California ($3.06) and Nevada ($3.00) are the market leaders and the only three states with averages above $3 per gallon. On the other end of the spectrum, a total of five states are posting averages below $2 per gallon: South Carolina ($1.90), Mississippi ($1.93), Alabama ($1.95), Tennessee ($1.99) and Louisiana ($1.99).
Pump prices are down in 47 states and Washington, D.C. in comparison to one week ago, with the motorists in the majority of these states (34 and Washington, D.C.) saving at least a nickel per gallon. Drivers in six states are benefitting from double-digit savings in the price of retail gasoline, with the largest discounts over this period seen in Alaska (-15 cents), South Dakota (-11 cents) and California (-11 cents). The Midwestern states of Indiana (+10 cents), Michigan (+ 8 cents) and Ohio (+7 cents) are the only three states outside of this trend, and prices have moved higher week-over-week. Prices in the Midwest have consistently been among the most volatile in the nation over the past several years, and while prices are up on the week, these same three states are among those posting the largest declines over the weeks prior.
With the exception of Utah (-4 cents), retail averages are discounted by double-digit increments in every state and Washington, D.C. month-over-month. The largest savings at the pump are seen in states where averages continue to move lower following the resolution of localized refinery issues : Illinois (-62 cents), Indiana (-56 cents), Michigan (-54 cents) and Wisconsin (-52 cents). Consumers in 33 states are saving a quarter or more per gallon to refuel their vehicles.
Year-over-year savings in the price of retail gasoline continue to widen nationwide, and motorists in 36 states and Washington, D.C. are saving at least a $1 per gallon. Consumers in Hawaii (-$1.32) and Connecticut ($1.21) are saving the most per gallon over this same period and 22 states are posting yearly savings of $1.10 or more per gallon. Nevada (-57 cents) and California (-68 cents), the only two contiguous states with averages above $3 per gallon, are also the only two states where drivers are not experiencing yearly savings of at least 75 cents or more at the pump.
The global oil market appears to be holding steady, following the Federal Reserve’s decision to leave interest rates unchanged. The Fed has kept interest rates near zero since 2008 in an effort to help stimulate economic growth. Raising U.S. interest rates often causes the U.S. dollar to gain strength, which makes oil more expensive for countries holding other currencies.
Oversupply characterizes the domestic oil market and attention remains focused on oil inventories and reports of production declines and falling oil rig counts. WTI closed out Friday’s formal trading session down $2.22, settling at $44.68 per barrel.
Motorists can find current gas prices along their route with the free AAA Mobile app for iPhone, iPad and Android. The app can also be used to map a route, find discounts, book a hotel and access AAA roadside assistance. Learn more at AAA.com/mobile.