Gasoline prices in much of the country have given up more ground even as millions of Americans traveled over the Thanksgiving holiday. The national average for a gallon of gasoline fell 4.2 cents per gallon versus a week ago to $2.496 per gallon this morning with average gasoline prices falling in all of the nation’s 50 states.
“With Thanksgiving travel now behind us, all eyes turn to OPEC and their meeting this week to determine the fate of the cartel’s oil production,” said Patrick DeHaan, head of petroleum analysis for GasBuddy. “Gasoline prices took a breather heading into Thanksgiving which may last another few days, but as oil prices perk back up heading into OPEC’s annual meeting, we may see a rebound soon. OPEC’s decision may reverberate at pumps in the months and year ahead, and while the decision is likely to be an extension of production cuts made at their meeting a year ago, it’s certainly not yet guaranteed. Global oil inventories have already tightened noticeably in the last year and continuing such in the face of rising demand may spur oil prices even higher in the days, weeks and months ahead.”
Oil prices surged Friday on optimism that OPEC will continue to curtail production leading global inventories to continue tightening against increasing demand. Oil prices Monday morning hit their highest since the summer of 2015 against the backdrop, which will nearly certainly lead gasoline prices to rise in 2018 compared to this year. 2017 looks to have the highest yearly average since 2014, and with demand continuing to rise, some analysts wonder if OPEC is being too heavy-handed, denying markets enough oil to meet rising demand.
Data from the Energy Information Administration last week Wednesday highlighted crude oil inventories dropping 1.9 million barrels, a level nearly 32 million barrels below last year. Meanwhile, gasoline inventories were unchanged in the past week yet remain nearly 14 million barrels lower than last year. Refineries utilized 91.3% of their capacity, signaling that autumn maintenance has largely wrapped up as gasoline production jumped to 10.4 million barrels per day. A large 6.2% increase in refinery utilization came in the Midwest (PADD 2), a region that weeks ago had been hard hit from maintenance, a pipeline leak, and low gasoline inventories. But the high utilization didn’t help the region as gasoline inventories fell to fresh multi-year lows.
Across the country, the largest changes in average gas prices by state: Indiana (-11 cents), Michigan (-10 cents), Illinois (-10 cents), Ohio (-10 cents), Nebraska (-6 cents), Wisconsin (-5 cents), Missouri (-4 cents), Kentucky (-3 cents), Minnesota (-3 cents) and Tennessee (-3 cents).
States with the lowest average gas prices: Alabama ($2.22), Mississippi ($2.23), South Carolina ($2.24), Tennessee ($2.26), Arkansas ($2.27), Missouri ($2.27), Texas ($2.27), Oklahoma ($2.28), Louisiana ($2.30) and Virginia ($2.31).
States with the highest average gas prices: Alaska ($3.22), Hawaii ($3.20), California ($3.19), Washington ($2.95), Oregon ($2.82), Nevada ($2.81), Pennsylvania ($2.78), Connecticut ($2.72), New York ($2.69) and Montana ($2.61).
Gas prices are at moderate risk of rising in Michigan, Indiana and Ohio as prices there have fallen 35-55 cents in the last few weeks due to intense competition, which has pushed some retailers to sell under cost, a situation that typically leads prices to rebound, while the rest of the country will most likely see continued relief from recent highs.
