AAA Fuel Gauge Report | July 16, 2012
(WASHINGTON, July 16, 2012) Today’s national average price for a gallon of regular self-serve gasoline is $3.40. From April 17 through July 2 the national average price at the pump declined for 75 of 77 days, falling 58 cents during that streak. Since July 2, when retail prices averaged $3.33, the downward trend has reversed and the national average has now increased for 13 of 14 days and has risen seven cents during this period.
Today’s national average price is two cents higher than the price one week ago, however the price remains 12 cents cheaper than one month ago, 28 cents cheaper than one year ago, and 54 cents cheaper than the year-to-date peak price of $3.94 in early April.
Rising gas prices in July also occurred last summer after prices fell 44 cents per gallon from a high of $3.98 on May 5 to a summer low of $3.54 on June 30. Last year prices increased 17 cents in July and remained elevated through Labor Day before declining following the busy summer driving period. This year, just more than halfway through July, the price at the pump has increased seven cents.
Drivers in all states and the District of Columbia continue to pay more than $3 per gallon at the pump. The cheapest gasoline in the country is in South Carolina, where drivers are paying an average $3.05. The most expensive gasoline in the continental U.S. is in California, which has a state average of $3.72.
The recent increase in retail gasoline prices has been primarily the product of increasing oil prices. This trend continued today as the price of West Texas Intermediate (WTI) crude oil increased $1.33 per barrel to settle at $88.43 at the close of formal trading on the NYMEX. This is the highest settlement price since May 29 when WTI ended the trading session at $90.76 per barrel. Today’s price is more than $10 per barrel higher than the lowest 2012 settlement price of $77.69 on June 28.
While the broader global economic and demand concerns that pressured crude oil prices dramatically lower this spring remain, prices have increased over the last several weeks as supply concerns, along with better than expected global economic news, have pressured oil prices higher. News last week of another round of increased U.S. sanctions on Iran put upward pressure on prices as the Iranian government responded with renewed threats that it could close the Strait of Hormuz. This important shipping route between Oman and Iran carries approximately one-third of global seaborne oil. Additionally, better than expected economic data from China to end last week helped to temper some market concerns of economic weakness in that country. Stronger global economies would be expected to demand more crude oil which puts upward pressure on prices.