Gas Prices Slowly Rise Causing Temporary Stall to Seasonal Savings

Tamra JohnsonToday’s national average price for regular unleaded gasoline is $2.21 per gallon, which is 3 cents more than last week and 8 cents more expensive than last month.  Today’s price represents a year over year discount of 9 cents from 2015.

2013-2016_Avg Gas Prices_9-19-16

Regional pump prices fluctuated dramatically this week due to pipeline repairs and localized supply disruptions.  In early September, a leak on Line 1 of the Colonial Pipeline occurred in Alabama and pressured prices in Southeast states sharply higher, including week-over-week increases of 7 cents or more in Georgia, North Carolina, South Carolina and Tennessee. The Line 1 of the pipeline runs from Houston, Texas to Greensboro, North Carolina and can carry 1.2 million barrels of gasoline per day. As a result of the leak and downtime for the repair, Colonial Pipeline announced over the weekend that it would construct a temporary pipeline to bypass the section of the line that is damaged. According to Colonial, the bypass would allow the pipeline to resume gasoline deliveries to impacted areas by the end of the week.

Until the pipeline bypass is completed, distribution issues will continue to put additional upward pressure on prices in the Southeast and possibly the Mid-Atlantic region. States that may continue to see tighter supply and higher gas prices include Alabama, Georgia, Mississippi, North Carolina, South Carolina, Tennessee and Virginia. The Colonial Pipeline has said it anticipates reopening the line later this week with the bypass in use, but it remains unclear how quickly they will be able to repair Line 1.

Quick stats

  • Average gas prices are below $2 per gallon in six states today including: Mississippi ($1.96), Texas (1.96), Missouri ($1.97), New Jersey ($1.98), Arkansas ($1.99) and Louisiana ($1.99).
  • The biggest weekly price increases are reflected in Georgia (+21 cents), South Carolina (+13 cents), Tennessee (+13 cents), North Carolina (+11 Cents), Ohio (+11 Cents), Indiana (+10 cents), Alabama (+7 cents), Delaware (+7 cents), Kentucky (+7 cents) and Hawaii (+6 cents).

Top10 Lowest Average Gas Prices-9-19-16

West Coast

Gas prices on the West Coast remain the highest in the country, including the top six most expensive state averages: Hawaii ($2.82), California ($2.76), Washington ($2.72), Alaska ($2.62), Oregon ($2.53), Nevada ($2.50). Despite having some of the most expensive prices, some drivers in the region are also enjoying some yearly savings with three states in the region making the list of top ten biggest yearly decreases: Alaska (-55 cents), Nevada (-52 cents), California (-33 cents). The West Coast region had not been impacted by problems on the Colonial Pipeline and the Oil Price Information Service (OPIS) predicts that prices in the Pacific Northwest and California may see some decreases over the next few weeks.

Rockies

Gas prices in the Rocky Mountain region are among the most stable prices in the nation. The states continue to be insulated from any refinery and pipeline issues and over the past month average prices have moved by a penny or less in three states: Idaho, New Mexico and Idaho. Drivers in the region are also enjoying large yearly discounts with Utah (-43 cents), Wyoming (-40 cents), Colorado (-39 cents), New Mexico (-29 cents), Idaho (-29 cents) and Arizona (-29 cents) all in the top ten largest discounts in the country.

Great Lakes and Central States

Drivers in these regions are enjoying some weekly price discounts due to sufficient supplies and limited disruption to production. These regions include five states registering some of the largest declines in the nation over the past week: Missouri (-6 cents), Illinois (-4 cents), Minnesota (-3 cents), Kansas (-2 cents) and Iowa (-2 cents). Midwestern declines are also featured in the top month-over-month comparisons, with four out of the five states posting a decline in this region: Michigan, Illinois, Missouri, and Ohio. On top of these weekly and monthly savings, drivers in two Central states continue to pay some of the cheapest gas prices in the country with Missouri ($1.97) and Oklahoma ($2.03) both featured in the top 10 cheapest state averages.

Mid-Atlantic and Northeast

Gas prices across most of the region have remained relatively stable with seven states featured on the list for smallest weekly changes: Connecticut, Maine, Massachusetts, Vermont, New Jersey, Rhode Island and New York. The most expensive averages in the region are Washington, D.C. ($2.36), Pennsylvania ($2.33), New York ($2.32) and Connecticut ($2.29). Some states in this region will be impacted by the problems on the Colonial Pipeline. OPIS reports that there will be less gasoline and diesel moving to Maryland, Washington, D.C., Delaware and New Jersey as a result of the leak. Colonial Pipeline has executed its alternative plan to construct a bypass line around the leak site to allow Line 1 gasoline distribution to return to service as rapidly and safely as possible. Colonial stated on Sunday that it is aiming to complete its bypass construction for Line 1 this week and restart full operation using the bypass for gasoline delivery from Houston to Greensboro, but there is a possibility construction may take longer than projected.

Top10 Largest Weekly Increases 9-19-16

South and Southeast

Gas prices in the South and Southeast continue to top the list for lowest prices, with six out of ten of the nation’s cheapest retail markets located in this region: Texas ($1.96), Mississippi ($1.96), Arkansas ($2.01), Louisiana ($1.99), Alabama ($2.01), South Carolina ($2.04). Some states in these regions have also seen significant weekly price increases due to a problem with the Colonial Pipeline, the major artery that brings gasoline, diesel and jet fuel from Texas and Louisiana refineries to a number of Gulf Coast and southeastern states. Reports from OPIS say the repair of a spill on the pipeline will limit the movement of gasoline from Texas and Louisiana refineries to multiple states in the South and Southeast regions including Alabama, Mississippi, Tennessee, Georgia, South Carolina and North Carolina.  Some of these states have already seen significant price movement over the past week with Georgia (+21 cents), Tennessee (+13 cents), South Carolina (+13 cents) and North Carolina (+11 cents) topping the national list of largest weekly increases.

Global Market Dynamics

West Texas Intermediate (WTI) crude oil closed last week trading lower following the release of the International Energy Agency’s crude oil report which forecast abundant supplies with diminishing demand. Meanwhile, the Colonial Pipeline announced Sunday evening that it was currently working to repair the leak on Line 1 and construct a bypass pipeline to reduce disruption of gasoline deliveries. Colonial said they are aiming to have the Line 1 bypass up and running this week, but many of those watching the market are skeptical of their ability to restart the line that quickly. Traders will continue to keep an eye on the Colonial Pipeline repairs, discussions surrounding the possibility of a Federal Reserve interest rate hike and the OPEC member meeting later this month. At the close of Friday’s formal trading session on the NYMEX, WTI was down .88 cents to settle at $43.03 per barrel, the lowest settlement since Aug. 11.

Drivers can find current gas prices along their route with the free AAA Mobile app for iPhone, iPad, and Android. The app can also be used to map a route, find discounts, book a hotel and access AAA roadside assistance. Learn more at AAA.com/mobile.

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