For the third straight week, gas prices have continued to move lower: the national average price for a gallon of gasoline has fallen 2.9 cents per gallon over the last week to $2.81 per gallon, the lowest level since April, according to GasBuddy data compiled from more than 10 million individual price reports. The national average price of diesel saw some relief as well, falling 0.7 cents to an average of $3.28 per gallon.
“From coast to coast, gas prices in nearly every state saw downward movement in the last week as sliding oil prices continued to keep the door open to falling gas prices. In fact, in the next 24 hours we’ll likely see the national average fall to its lowest point in over six months,” said Patrick DeHaan, head of petroleum analysis for GasBuddy. “Saudi Arabia has indicated it is prepared to raise oil production, addressing what had been a major concern ahead of Iran sanctions taking effect. Oil prices have fallen over 10 percent in recent weeks, providing the bulk of the gas price relief we’re seeing, and will continue to see for the next week or two at least. While there is still some anxiety globally over a lack of spare oil capacity, the market has been laser focused on discussion from oil producers, including Russia, that they will act to raise production. OPEC meets in early December, and any official increase in oil production could go a long way to temper concerns of shortcomings in the market.”
The weeks of falling crude prices may be at last coming to an end as fundamentals may begin to be more supportive in advance of U.S. trade sanctions coming into full effect on Sunday, an approaching bilateral meeting on trade between the U.S. and China and this despite grumblings over a slowdown in global economic activity which has spurred the recent rout in crude prices.
The overhang of Saudi Arabia’s talk last week about a possible supply glut continues to be a pervasive theme in trades his morning with WTI crude oil down a half dollar a barrel at $67.14 a barrel while Dated Brent is holding above $77. Early indications of markets show a weaker close may be upended by a growing number of refineries emerging from delayed and lengthy maintenance, causing a bump in crude demand and therefore prices. Considering several key importers of Iranian crude are lamenting the tightness in alternative supplies, the correction in oil prices may soon be reversed and that, perhaps unexpectedly, because the current orthodoxy on oil trade appears to be based on the questionable assumption of falling demand and the drop in equities markets casting a tall shadow over commodities futures markets.
47 states saw average gas prices decline in the last week, while just three Great Lakes states (Michigan, Indiana, Ohio) saw prices rise, due to a volatile pattern dubbed “price cycling” in those areas. Leading decliners: Iowa (-7 cents), Nebraska (-6 cents), Louisiana (-6 cents), Oklahoma (-6 cents) and Texas (-6 cents).
States with the lowest average gas prices: Oklahoma ($2.47), South Carolina ($2.49), Delaware ($2.51), Louisiana ($2.51) and Mississippi ($2.52).
States with the highest average gas prices: Hawaii ($3.83), California ($3.79), Washington ($3.52), Oregon ($3.36) and Alaska ($3.33).
