AAA Monthly Gas Price Report: February 2014 Trends and March Outlook
(Washington, February 28, 2014)
Gas Prices in February Post Largest Increase since Summer Driving Season
- Gas prices ended February with the largest increase since July with the national average rising about 17 cents per gallon (five percent) over the course of the month. Today’s national average price of gas is $3.45 per gallon.
- “Strong winter storms and weak demand have helped to keep gas prices less expensive this winter, but many drivers recently have noticed that it is starting to cost more to full up,” said Avery Ash, AAA spokesman. “We are entering the worst time of year for visiting the gas station as prices rise primarily due to seasonal refinery maintenance.”
- The national average has increased for 21 days in a row, which is the longest consecutive streak since last February. Gas prices typically rise this time of year because many refineries cut production to conduct seasonal maintenance, which can limit gasoline supplies and cause market uncertainty. This maintenance generally takes place between strong demand periods for heating oil in the winter and gasoline in the summer.
- Today’s national average is 33 cents per gallon less expensive than a year ago, which reflects the fact that prices peaked early in 2013 due to heavy refinery maintenance in January and February. Gas prices last year reached $3.79 per gallon on February 27, which was the earliest peak price on record. This year severe winter storms and a later refinery maintenance schedule likely will result in peak prices in March or April.
- Gas prices averaged $3.34 per gallon in February, which was the cheapest monthly national average since 2011. By comparison, prices nationally averaged $3.65 in Feb. 2013, $3.55 in Feb. 2012 and $3.17 in Feb. 2011.
- The price of domestic West Texas Intermediate crude oil has increased about $5.00 per barrel this month. Crude oil represents about two-thirds of the cost of gasoline, and producers generally pass along increased oil costs to consumers in the form of higher gas prices.
Gas Prices Likely to Peak at $3.55-$3.75 per Gallon in March or April
- AAA forecasts the national average price of gas will continue to rise before reaching a peak between $3.55-$3.75 per gallon in March or early April. Despite these potentially significant increases, AAA expects prices to remain less expensive than last year’s peak of $3.79 per gallon.
- “Buying gas in the spring can be a frustrating challenge because prices seem to be higher every time you get in the car,” continued Ash. “Yet even as prices inevitably rise, there is a good chance that most people should pay less than recent years to buy gas.”
- A relatively trouble-free refinery maintenance season and continued strong winter storms could result in prices remaining on the lower end of AAA’s prediction, while unexpected refinery problems, strong demand and higher oil costs could result in more expensive gas prices.
- AAA expects gas prices this year to be less expensive than in 2013 due to the fact that many refineries have increased capacity to take advantage of the recent boom in North American crude oil production. The most recent data from the Energy Information Administration shows U.S. gasoline supplies at 230.6 million barrels, which is above the five-year average for this time of year.
- Gas prices in March may also rise because of the switchover to summer-blend gasoline. While this process can take place at different times of year depending on local regulations, the majority of refineries and pipelines must switchover by April 1. Summer-blend gasoline is less likely to evaporate and cause warm-weather air pollution such as smog, but it can increase costs by 5-15 cents per gallon.
- Gas prices on average decreased 15 cents per gallon in March 2013, but this was unusual and due to an early peak in prices. Gas prices in March have increased four out of the previous five years at an average of 11 cents per gallon.
- In 2012 the national average increased 56 cents per gallon over a 70 day period before peaking at $3.94 per gallon on April 5. In 2011 national average increased 89 cents per gallon during a 94 day period before peaking at $3.98 per gallon on May 5.
Drivers in 49 States are Paying Less Expensive Gas Prices than a Year Ago
- Drivers in every state but Wyoming are paying less than a year ago for gasoline. The five states with the highest average prices today include: Hawaii ($4.08), California ($3.84), Alaska ($3.77), Connecticut ($3.75) and New York ($3.74). The five states with the lowest average prices include: South Carolina ($3.17), Montana ($3.18), Alabama ($3.21), Mississippi ($3.22) and Tennessee ($3.22).
- The highest state average in the continental U.S. a year ago was California at $4.24 per gallon, while the cheapest was Wyoming at $3.29 per gallon.
- Every state in the country is more expensive than a month ago due to recent refinery maintenance and increased crude oil costs. The largest increases include: Michigan (39 cents), Indiana (34 cents), Ohio (34 cents), Colorado (33 cents) and South Dakota (27 cents).
- Less than one percent of all U.S. stations are selling gas for less than $3.00 per gallon today, which compares to more than one in four stations selling below that price in November.
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, firstname.lastname@example.org.