AAA Monthly Gas Price Report: May 2013 Trends and Summer Outlook
(WASHINGTON, May 31, 2013)
Gas Prices Increased in May for the First Time Since Winter
- The national average price of gas increased 10.4 cents per gallon (2.96 percent) in May, which was the first monthly increase since February. Rising gas prices in many parts of the country led to significant motorist frustration heading into the busy summer driving season.
- The national average increased 17 days in a row to $3.66 per gallon from May 6 until May 22, which was the largest consecutive streak of price increases since February. The national average has since dropped nine days in a row to $3.61 per gallon. Gas prices nationally increased 19 out of 31 days during the month. By contrast, prices increased only one day during May in 2012 and increased only seven days during the month in 2011.
- “Consumers in the Midwest and other parts of the country faced tremendous frustrations due to rapidly rising gas prices in May,” said Avery Ash, AAA spokesman. “Continued refinery maintenance and other production issues led to tight supplies and a spooked market for much of the month. After seeing prices decline this spring, many motorists were unhappy to pay higher prices heading into the busy travel season.”
- Gas prices increased in many parts of the country due to tight supplies caused by refinery maintenance and unexpected production issues, particularly in the Midwest, Rockies and Pacific Northwest. Relatively tight supplies and concerns about production typically lead to rising gas prices.
- West Texas Intermediate (WTI) oil prices also increased more than 10 percent from slightly below $87 per barrel in mid-April to more than $96 per barrel in mid-May. Rising oil prices increase gasoline costs resulting in higher pump prices for consumers. The price of WTI has since dropped to the most recent settlement price of $93.61 per barrel.
- Despite the rising prices, motorists on average paid less at the pump in May than recent years. The national average for the month was $3.59 per gallon, compared to $3.72 per gallon in 2012 and $3.91 in 2011.
- Half of U.S. adults consider gas prices to be “too high” when it reaches $3.44 per gallon, according to a new consumer index developed by AAA. Forty-six percent of adults believe gas is too high when it reaches $3.00 per gallon; 61 percent believe it is too high when it reaches $3.50 per gallon; and 90 percent believe gas is too high when it reaches $4.00 per gallon. Sixty-two percent of Americans are offsetting high gas prices by changing their driving habits or lifestyle.
Gas Prices Should Drop in June as Refinery Maintenance Winds Down
- “Gasoline supply problems should ease over the next month as some refinery maintenance comes to an end,” continued Ash. “Prices should drop below a national average of $3.50 per gallon by the end of June if refineries can transition smoothly from ongoing maintenance to full production. Some concerns remain though because refineries often have complications when restarting, which could lead to unpredictable problems in the weeks ahead.”
- The highest national average so far this year was $3.79 per gallon on Feb. 27. It is becoming increasingly possible that gas prices peaked for the year in February, but there is still potential for prices to spike later in the year. AAA has no record of gas prices ever previously peaking in February.
- Gas prices often rise in late summer due to the hurricane season and a decline in supplies immediately prior to the switchover to winter-blend gasoline, so it is possible that motorists could pay higher prices later this year.
Gas Prices in the Great Plains Reached All-Time Record Highs in May
- Motorists in the Great Plains paid among the highest gas prices the region had ever seen in May with both Minnesota and North Dakota breaking all-time record highs for each state. The average price of gas reached $4.27 per gallon on May 20 in Minnesota, while the average reached $4.24 per gallon in North Dakota on May 22.
- In the days leading up to Memorial Day, consumers in 11 states were paying at least 30 cents per gallon more than the previous month. Motorists in nine states paid an average of more than $4 per gallon including Alaska, California, Hawaii, Iowa, Illinois, Minnesota, North Dakota, Nebraska and Washington. At the peak, the price of gas increased more than 80 cents per gallon in Minnesota and 60 cents per gallon in North Dakota from the previous month. Gas prices across the region have begun to ease slowly from these record highs.
- Gas prices spiked across the Midwest due to significant refinery and supply issues. Planned maintenance and upgrades at several refineries, including BP Whiting and ExxonMobil Joliet, in addition to unexpected problems at several other regional refineries, limited production and reduced gasoline supplies. The Pacific Northwest and Rockies experienced similar refinery issues, but to a lesser extent than in the Great Plains.
- The price of gasoline continues to vary dramatically with the cheapest gasoline primarily found in the Southeast. The five states with the highest averages today include: Hawaii ($4.36), Alaska ($4.08), N.D. ($4.06), Calif. ($4.01) and Ill. ($3.97). The five states with the lowest averages today include: S.C. ($3.22), Ala. ($3.25), Miss. ($3.26), Tenn. ($3.27) and La. ($3.32).
Learn how to save money on gas with a few simple tips from AAA.
AAA updates fuel price averages daily at www.FuelGaugeReport.AAA.com. Every day up to 120,000 stations are surveyed based on credit card swipes and direct feeds in cooperation with the Oil Price Information Service (OPIS) and Wright Express for unmatched statistical reliability. All average retail prices in this report are for a gallon of regular, unleaded gasoline. For more information, contact Michael Green at 202-942-2082, email@example.com.