(GasBuddy)For the fifth consecutive week, the nation’s average gas price has fallen, declining 2.4 cents from a week ago and stands at $3.32 per gallon Monday 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 is down 9.0 cents from a month ago and $1.18 per gallon higher than a year ago. The national average price of diesel has fallen 0.2 cents in the last week and stands at $3.605 per gallon.
“With the price of crude oil remaining some $13 per barrel below its 2021 peak, we have continued to see gas prices decline in nearly every city coast to coast, a trend that will likely continue into yet another week,” said Patrick De Haan, head of petroleum analysis for GasBuddy. “Omicron concerns continue to be the primary catalyst for the drop in gas prices across much of the country. While we’ve seen some anecdotal reports about the new variant, vaccine producers have yet to definitively state if current vaccines will still bring adequate protection against omicron- something that might be critical to limit severity and to avoid new shutdowns. With OPEC+ members still planning to boost oil production in January, we continue to see global oil production slowly rising. In addition, U.S. gasoline demand last week fell to the lowest level since October, which may limit oil’s recent rebound and keep gas prices declining through the end of the year.”
With some evidence that thus far, the omicron variant has not turned into the worst case scenario, oil markets have continued an anxious but optimistic rally. In early Monday trade, a barrel of West Texas Intermediate crude oil was down 23 cents to $71.44 per barrel, about $3 per barrel higher than last week’s $68.18 level. Brent crude oil was down 27 cents in early Monday trade to $74.89 per barrel, also $3 per barrel higher than last Monday’s $71.82 per barrel print. OPEC raised its forecast for oil consumption in its Monthly Oil Market Report, issued today. They forecast global demand to rise 200,000 barrels higher than previous estimates to 96.63 million barrels. They held growth levels unchanged thus far, highlighting that they expect omicron to “have mild and short-lived effects”.
According to Baker Hughes, last week’s U.S. rig count rose by 7 to 576, and was 238 rigs higher than a year ago. The Canadian rig count fell by 3 to 177, or 66 more than a year ago.
OIL AND REFINED PRODUCT INVENTORIES
According to the Energy Information Administration, oil inventories saw a 200,000 barrel drop last week, but adding in the Strategic Petroleum Reserve, fell closer to 2 million barrels as refiners draw down inventories ahead of the end of the year to avoid a hefty tax bill. In turn, refiners boosted utilization rates by 1.0 percentage points from last week to 89.8%. As a result of the higher run rates, gasoline inventories rose 3.9 million barrels and distillate inventories jumped 2.7 million barrels. EIA’s proxy for retail gasoline demand, implied demand, rose 167,000 barrels per day to 8.96 million barrels of gasoline demand per day. Total U.S. petroleum inventories stand down nearly 150 million barrels from last year.
According to GasBuddy demand data driven by its Pay with GasBuddy card, U.S. retail gasoline demand fell last week (Sun-Sat) ahead of the Christmas holiday. Nationally, weekly gasoline demand was down 3.7% from the prior week, while demand fell 4.7% in PADD 1, fell 3.5% in PADD 2, fell 3.6% in PADD 3, fell 2.2% in PADD 4 and fell 3.6% in PADD 5.
GAS PRICE TRENDS
The most common U.S. gas price encountered by motorists stood at $2.99 per gallon, down 20 cents from last week, followed by $3.19, $3.09, $3.29 and $3.39 rounding out the five most common prices.
The average cost at the priciest 10% of stations stands at $4.42 per gallon, unchanged from a week ago, while the lowest 10% average $2.76 per gallon, down 4 cents from a week ago.
The median U.S. price is $3.19 per gallon, a decline of 4 cents from last week and about 13 cents lower than the national average.
The states with the lowest average prices: Oklahoma ($2.85), Texas ($2.86) and Arkansas ($2.92).
The states with the highest priced states: California ($4.66), Hawaii ($4.29) and Washington ($3.86).