Gas Prices Face Uncertain Future This Summer
Gas prices stabilized in the U.S. over the past few weeks and looked primed to start declining, but a cautionary report from the Energy Information Administration Wednesday renewed worries that oil and gasoline prices could still increase this summer.
The EIA said that inventories of crude oil and gasoline in the U.S. fell more than expected during the past week. That helped trigger higher oil prices on global markets and created clouds in the crystal balls of analysts who had predicted pump prices were about to fall.
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On Monday, for example, GasBuddy.com confidently declared, “Motorists need not fret any longer, it appears that the national average may have just peaked, and is now starting to decline. Based on current factors and signs, we could see price declines begin to accelerate.”
But on Wednesday, after the EIA report, GasBuddy backpedaled and warned, “If anything can be taken from this report for motorists, it’s that this could change the landscape (again), and perhaps the national average hasn’t peaked as gas stations will likely be facing higher wholesale prices for gasoline.”
The AAA travel services organization also predicted Monday that gas prices could fall during the summer, noting that OPEC had decided not to cut oil production, keeping the global supply at high levels.
GasBuddy said the national average for regular unleaded was $2.77 Thursday, fractions of a penny higher than a week ago. The AAA Daily Fuel Gauge Report pegged the national average at $2.76, also just fractions of a penny higher than its calculation a week ago.
According to AAA, the national average for regular has increased just 3 cents over the past three weeks, and prices had started to inch down in some states that had experienced significant price increases recently.
In Illinois, for example, the statewide average for regular fell 2 cents the past week to $2.93, though that is still 22 cents higher than a month ago. The supply of gas in Illinois has been crimped in recent weeks because of production problems at Midwestern refineries, causing pump prices to rise.
California remained the most expensive state for gas, but the average for regular there fell 9 cents the past week to $3.56. Gas supplies in California also have been reduced by refinery issues, but AAA said gas from other states has helped offset the drop in local production. The price of regular has fallen for four weeks in a row in California for a total of 24 cents.
Six other states averaged more than $3 for regular: Alaska, Hawaii, Nevada, Oregon, Utah and Washington.
The cheapest gas could be found in South Carolina, where regular averaged $2.46. Mississippi, at $2.49, was the only other state averaging less than $2.50.
Diesel fuel fell by a penny the past week to a national average of $2.87, according to AAA, $1.03 less than it was a year ago.
The national average of $2.76 for regular gas is 88 cents less than it was on June 11, 2014, AAA said. At $3.15 per gallon, premium gas is 85 cents cheaper than a year ago.
