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GasBuddy’s Weekly Outlook: Will OPEC’s Production Cut Become a Reality?

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It seems like ages ago when OPEC first announced intentions to cut production and bolster gobal oil prices. While day-to-day sentiment still waivers on the likelihood of a substantive agreement, if the latest crude oil prices are any indication, OPEC’s highly anticipated meeting on Wednesday in Vienna could be anticlimactic.

“Early last week WTI crude had climbed above $48 [per barrel] but was unable to hold on, and in late trading Friday had slipped below $46,” said Gregg Laskoski, senior petroleum analyst for GasBuddy. “And that probably ties directly to doubts about Iraq, Iran and the likelihood that Russia—the largest non-OPEC oil exporter—will agree only to a freeze and not a productin cut of its own, which OPEC says is essential for the cartel to implement its plan to cut back by 1 million barrels per day.”

“Prices at the pump generally fall in December. In the last four years, we’ve seen the U.S. average price of gas increase just once in December—that was in 2013, when the national average ended the month 5 cents higher than when it started. And it’s also falledn precipitously…in December 2014, the national average plummeted 51 cents per gallon from $2.75 to $2.24. Over the past four years, the average decline from December 1 to December 31 has been 15 cents per gallon, and I’d have to think most of us would be pretty happy with that,” Laskoski added.

 

Current Prices

Right now, the U.S. average price of gasoline is $2.11, 2 cents less than a week ago and just 7 cents more than where it stood a year ago.

In the U.S. today, there are 12 states where the average price of gasoline is $1.99 or less: Oklahoma, Arkansas, Kansas, Missouri, Texas, Mississippi, South Carolina, Alabama, Louisiana, Tennessee, Montana and Virginia.

Conversely, only four states have average gas prices above $2.50 per gallon—Alaksa, Washington, California and Hawaii—but none have gone about $3 per gallon this year.

The biggest decreases in gas prices in the last week have been: Ohio (-7 cents), Idaho (-6 cents), Wyoming (-6 cents), Indiana (-5 cents), Michigan (-4 cents) and Colorado (-4 cents).

The largest increases during the past week were recorded by: Oklahoma (+5 cents), Washington, DC (+5 cents), Wisconsin (+4 cents) and Minnesota (+2 cents).

 

Regional Breakdowns

Midwest: The Midwest saw notable declines in the last week with Ohio’s average dropping by 6 cents per gallon, followed by 4-cent decreases in Indiana and Michigan.  Refineries in the region are operating at the highest level in the country at 92.5%,  according to the latest EIA report, which exceeded the national utilization rate of 89%.

West Coast: The Pacific Northwest has benefited from the steepest declines in wholesale gas prices from late October through late November, and consequently we see Idaho’s average down by 6 cents per gallon in the past week—11 cents less than a month ago. Washington’s average today is down 3 cents in the past week and 14 cents in the past month. Oregon ‘s average is also 3 cents lower from a week ago and 13 cents lower in the past month.

Rockies: Rocky Mountain states have seen their average prices decline at a pace exceeding the national average, with Montana leading with a 4-cent decrease in its average during the past week. Colorado and Utah both saw their averages shed 3 cents a gallon, while Wyoming and Arizona prices declined by 2 cents. New Mexico only saw a 1-cent decrease in the past week.

South and Southeast: Gasoline prices continue to fall at a pace comparable with the rest of the U.S. In Texas Mississippi, South Carolina, Alabama, Louisiana and Tennessee, statewide averages range from $1.89 to $1.94. Florida and Georgia are tied with the high for the region at $2.08 per gallon, with North Carolina close behind at $2.07.

Northeast: Prices in New York, Boston and Philadelphia have seen decreases of just one cent in the past week, while their respective state averages (and most of the northeast) remains even with where they stood a week ago. While the national average is down 2 cents per gallon, the northeast trails the pace undoubtedly due to the slip in the region’s refinery output from 88% to 84% in the week last reported by the EIA.

GasBuddy is a company that connects drivers with their Perfect Pit Stop. As the leading source for crowdsourced, real-time fuel prices at more than 150,000 gas station convenience stores in the U.S., Canada and Australia, millions of drivers use the GasBuddy app and website every day to find gas station convenience stores based on fuel prices, location and ratings/reviews. GasBuddy’s first-of-its-kind fuel savings program, Pay with GasBuddy, has saved Americans more than $3.6 million at the pumps since its launch in 2017.