Gas price streak snapped as average prices fall for first time in 10 weeks

National/World

(GasBuddy) – For the first time in ten weeks, the national average price of gasoline has fallen, posting a drop of 1.2 cents per gallon over the last week to $2.17 according to GasBuddy data compiled from more than 11 million individual price reports covering over 150,000 gas stations across the country. The national average price of diesel has increased 0.6 cents and stands at $2.42 per gallon over the same period.

“With July 4 behind us, we’re now half way through the summer driving season, and the pace of gas price increases has finally hit a wall. And finally, we’ve broken the nine week rise in average prices thanks to a drop in demand fueled by COVID-19 cases surging in some states,” said Patrick De Haan, head of petroleum analysis for GasBuddy. “So far this summer, both holidays have seen the lowest prices since 2004, and it’s possible that if things don’t improve much by Labor Day we could see the rare trifecta of every summer holiday setting multi-year lows. For now, I believe we may see increases stall and some minor increases or decreases until we see a solid change in the coronavirus situation. For now, some states will see slight increases, some may see slight decreases, but gas prices are essentially stuck in limbo.”

Crude oil prices have seen little overall change over the last week, with a barrel of West Texas Intermediate crude oil down 11 cents in early Monday trade to $40.54 per barrel, up about $1 from last week’s start of $39.55. Brent crude oil was fetching $43.12 per barrel in early Monday trade, up from $41.47 a week ago. Crude oil prices remain in limbo, along with gas prices, as the next chapter in the coronavirus situation remains murky. With some states seeing a resurgence and early signs of a slowdown in gasoline demand recovery, oil prices haven’t been able to muster additional steam to rally.

Oil inventories posted a strong drop last week, according to data from the Energy Information Administration. Inventories plummeted 7.2 million barrels, while gasoline inventories saw a 1.2 million barrel rise and distillate inventories sagged 600,000 barrels. U.S. oil production continues to be some 2 million barrels per day lower than where we started 2020, as COVID-19 decimated oil demand. Refinery utilization continued to recover, per EIA data, with utilization rates rising 0.9% to 75.5%. Gasoline production rallied to 8.9 million barrels, its highest level in months, while distillate fuel production amounted to 4.6 million barrels per day.

At gas pumps across the country, average price changes were a mixed bag with more states declining than rising. The most common U.S. gas price encountered by motorists stood at $2.09 per gallon, up 10 cents from last week, followed by $1.99, $1.89 and $2.19. The average cost at the priciest 10% of stations stands at $2.97 per gallon, up 6 cents from a week ago, while the lowest 10% average $1.76 per gallon, down a cent from a week ago. The median U.S. price was unchanged at $2.09 per gallon, about 8 cents lower than the national average. The states with the lowest average prices: Mississippi ($1.82), Louisiana ($1.83) and Arkansas ($1.86), while the highest priced states were Hawaii ($3.13), California ($3.07) and Washington ($2.71).

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