The Shadow
Motorists across the country kicked off 2015 with the continued downward trend in gas prices.
The national average for regular gasoline is $2.23 per gallon, which is nine cents lower than a week ago, 53 cents less than last month, and $1.10 less than last year’s price. The national average has now fallen for 99 consecutive days, the longest streak on record.
Even in Virginia, where a two percent gas tax increase took effect Jan. 1, no uptick in the cost at the pump is immediately apparent.
The national annual average price of gasoline in 2014 was $3.34 per gallon, which was 15 cents less than last year’s annual average of $3.49 per gallon. In recent years, gas prices have averaged $3.60 per gallon in 2012, $3.51 in 2011, and in 2010 the annual average was $2.78 per gallon.
The global oil market remains in a state of perceived oversupply due to record production from the United States combined with lower than expected global demand. Despite falling crude prices, Saudi Arabia, OPEC’s largest exporter of petroleum, has reiterated the cartel’s intention to maintain current production levels and allow the market to self-correct. This move could put pressure on higher cost production areas.
, such as the United States, facing a market where low prices make production unprofitable. The ripple effects of prolonged low oil prices could also pose a challenge to countries whose economic stability is dependent on revenue from oil production. As has been the case in recent years in Egypt, Libya and Iran, this sort of geopolitical unrest can impact global supply and pressure oil prices higher on the threat of a disruption.
West Texas Intermediate (WTI) crude oil continued to trade below $55 per barrel for the fourth consecutive trading day, closing at $53.27 per barrel on December 31. Markets were closed on New Year’s Day. As of early morning Friday, the commodity was trading around $52 per barrel, a new low not seen since May 2009, but by noontime has since made some gains.
