Gas Prices Could Start To Fall Soon
The cost of gasoline should start coming down soon because recent history and most current indicators point to favorable conditions for lower pump prices.
The AAA travel organization cautiously predicted that prices will fall soon because U.S. refineries have completed the annual changeover to summer blends, most refineries have completed seasonal maintenance, the supply of oil and gas is ample, and, over the last five years, pump prices have dropped an average of 12 cents during June.
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“There is a good chance that average U.S. gas prices will drop soon due to stabilizing crude oil costs and as refineries complete season maintenance, which would result in the cheapest summertime gas prices since 2009,” AAA said in its monthly gas price report.
GasBuddy.com senior petroleum analyst Patrick DeHaan sounded more confident, writing in his blog, “After nearly two months, the national average is poised to give up some steam and declines will emerge across a growing portion of the country over the next two weeks.”
The national average for regular unleaded gas fell almost to $2 per gallon in late January, but steady increases over the last two months pushed it up to $2.76 Thursday, according to the AAA Daily Fuel Gauge Report.
AAA had predicted that prices would increase only modestly in the spring because of refinery maintenance and the change to more expensive summer gas blends, and DeHaan suggested that pump prices may have peaked for the year when the national average reached $2.47 in early March.
What happened to cause pump prices to rise more than 70 cents?
Oil prices increased by about $15 per barrel after reaching multiyear lows in the spring, just as gas production in the U.S. slowed because of refinery maintenance and the switch to summer blends, according to AAA. On top of that, a major refinery in California was crippled by an explosion and several refineries elsewhere have been slowed by various issues and unscheduled maintenance, further reducing the supply at the pumps when more motorists were taking to the roads.
Though most gasoline production issues have been resolved, AAA said motorists in the Midwest are still getting squeezed at the pump because refineries in Joliet and Lemont, Ill., and Toledo, Oho, are running at reduced rates. Prices in Ohio jumped 10 cents the past week to a statewide average of $2.77 for regular.
The national average for a gallon of regular unleaded crept up 2 cents the past week to $2.76, but diesel fuel prices fell by a penny to $2.88. In spite of recent increases, regular was 90 cents cheaper on Thursday than it was a year ago, and diesel was $1.04 less.
AAA listed South Carolina as having the cheapest gas with an average of $2.46 for regular. Mississippi, at $2.48, was the only other state averaging less than $2.50. Arkansas, Oklahoma and Tennessee were at $2.51.
California, still recovering from the recent refinery explosion and other production issues, had the highest price with a statewide average of $3.65 for regular, though the price has fallen for three straight weeks by a total of 15 cents.
Alaska, at $3.36, and Hawaii, $3.30, were next highest. Other western states impacted by the refinery woes in California also averaged more than $3, including Nevada, Oregon, Utah and Washington state.
