WASHINGTON —Fall is here, but instead of taking a seasonal dip, gas prices still reflect summertime levels when demand was higher. The national average dropped a penny on the week to $3.18 after matching a seven-year-high in the prior week. The big culprit in keeping pump prices high is the price of crude oil, which is above $73 bbl.
“Consumers should see the usual autumn relief at the pump,” said Andrew Gross, AAA spokesperson. “But factor in that approximately 16 percent of crude production in the Gulf of Mexico is still shut down because of Hurricanes Ida and Nicholas and the concerns about what higher COVID cases could do to the economy, and this uncertainty is helping to keep oil prices elevated.”
According to new data from the Energy Information Administration (EIA), total domestic gasoline stocks increased by 3.5 million bbl to 221.6 million bbl last week. Gasoline demand is low at 8.90 million b/d, helping to offset some of the upward pressure caused by higher crude oil prices. With the hurricane recovery and restoration process continuing, pump prices may stabilize. Most Louisiana refineries are running again, as witnessed by storage levels growing by 1.5 million bbl. However, high crude prices (above $72 per barrel) will contribute to gasoline prices likely remaining elevated this fall.
Today’s national average of $3.18 is four cents more than a month ago and is 99 cents more than a year ago.
The nation’s 10 largest weekly changes were in Michigan (+8 cents), Ohio (−8 cents), Indiana (−6 cents), Illinois (−5 cents), Kentucky (−5 cents), Nevada (−4 cents), Delaware (+3 cents), Florida (−3 cents), Maryland (+2 cents) and Utah (−2 cents).
The nation’s 10 least expensive markets are Mississippi ($2.81), Texas ($2.82), Arkansas ($2.83), Missouri ($2.84), Oklahoma ($2.85), Alabama ($2.86), Tennessee ($2.89), Louisiana ($2.89), South Carolina ($2.89) and Kansas ($2.90).
At the close of Thursday’s formal trading session, WTI increased by 68 cents to settle at $73.98. Crude prices increased on the week following the release of EIA’s recent report showing that total domestic crude inventories decreased by 3.4 million bbl to 414 million bbl.
Additionally, crude prices rose after the Federal Reserve signaled it could raise interest rates in 2022 and end its bond-purchase program that has supported the economy since the start of the COVID-19 pandemic. For this week, crude prices could continue their ascent if EIA’s next report shows another weekly decline.