OPEC Reduction Plans Continue to Push Gas Prices Upward
CARS.COM — Gas prices continued to creep up during the past week, rising by 3 cents a gallon to a national average of $2.23 for regular on Thursday, as major oil producers solidified plans to cut production in January — a move that will likely push pump prices higher.
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Prices rose in all but a handful of states, and the AAA Daily Fuel Gauge Report said Thursday that the national average for regular has gained 8 cents a gallon since Dec. 1. That was the day after the Organization of Petroleum Exporting Countries reached an agreement to cut oil production to boost global prices for crude.
Non-OPEC countries, including Russia, the world’s second-largest oil producer, signed on to the production cut last weekend. U.S. oil prices jumped about $3 a barrel on Monday to more than $54 but fell back to about $50 by Thursday.
Gas prices typically fall this time of year because Americans drive less during the cold months, but the OPEC agreement has turned that dynamic upside down. The national average for regular is 22 cents higher than a year ago, according to AAA and price-tracker GasBuddy.com, and premium gas is 21 cents higher at $2.72.
GasBuddy senior analyst Patrick DeHaan said motorists who bought vehicles with little or no regard to fuel economy should brace for higher prices next year.
“The current news and trends bode poorly for motorists who’ve gone back to driving larger cars over the last two years, and 2017 will likely see higher prices than where we stand today,” DeHaan said in a blog post.
A week ago, regular gas averaged less than $2 a gallon in four states, but AAA on Thursday said the lowest statewide average was $2.01, in Arkansas and Oklahoma. Seven other states averaged $2.05 or less. (Prices fluctuate throughout the day and could change.) GasBuddy said gas for less than $2 was still available at nearly 1 in 5 stations across the country. A year ago, though, more than two-thirds of gas stations were selling regular for less than $2.
Hawaii had the highest average price, $2.93, according to AAA, and three other states and the District of Columbia averaged more than $2.50. Prices rose 6 cents the past week to $2.53 in Washington, D.C. The biggest price jumps were in Indiana, where regular gas rose 9 cents a gallon, and in Florida and Michigan, where average prices rose 10 cents. The average for regular in Florida has increased 16 cents the past two weeks to $2.31 a gallon.
The national average for diesel fuel, which typically becomes more expensive this time of year, rose 2 cents to $2.44 a gallon and is 9 cents higher than a year ago. Diesel fuel is more expensive in the winter because some of the heavier crude oil used to make it is diverted to home heating oil.
