November 23rd, 2015 by Amanda Shapiro
(WASHINGTON, November 23, 2015) Approximately 42 million Americans are expected to take a road trip this Thanksgiving, and drivers should pay the lowest pump prices for the Thanksgiving holiday since 2008. Retail averages have fallen for 17 consecutive days for a total savings of 15 cents per gallon, and the national average remains poised to fall below the $2 per gallon benchmark by the Christmas holiday. Already, more than half of U.S. stations are selling gas for less than $2 per gallon. Today’s national average price of $2.07 per gallon represents a savings of nine cents per gallon versus one week ago, and 14 cents per gallon on the month. Significant yearly savings persist and pump prices are down 75 cents per gallon compared to this same date last year.
Midwestern refineries continue to come back online following both planned and unplanned maintenance work. According to the U.S. Energy Information Administration, production in the region reached its highest rates in nearly two months, which has also helped gas prices recover in the region following recent spikes due to unexpected outages. As a result of more supply entering the regional market, the largest weekly and monthly declines in the price at the pump are localized to this region and drivers in Wisconsin, Michigan, Illinois, and Indiana are benefitting from noticeable savings in the price of retail gasoline.
Demand for gasoline typically declines during the month of November, and barring any unexpected disruptions in supply, the national average is expected to move lower leading into 2016.
The list of states with retail averages below $2 per gallon has added seven new members since one week ago, for a total of 18 states. Pump prices have moved markedly lower in the Midwest week-over-week, and Indiana ($1.82), Ohio ($1.83) and Oklahoma ($1.85) edged out Alabama ($1.85) and South Carolina ($1.85) as the nation’s least expensive markets for gasoline. Hawaii ($2.83) is the market leader, where drivers are paying more than $1 per gallon more than the nation’s least expensive market Indiana. Regional neighbors California ($2.73), Nevada ($2.59), Washington ($2.48) and Alaska ($2.40) join Hawaii in the rankings as the top five most expensive markets.
With the exception of Alaska (+2 cents), drivers nationwide are enjoying weekly discounts in the price to refuel their vehicles. Averages in the majority (36) of states are down a nickel or more per gallon, and consumers in a dozen states have seen prices fall double-digits from one week ago. The largest savings over this same period are in the Midwestern states of Wisconsin (-24 cents), Michigan (-23 cents), Indiana (-20 cents) and Ohio (-18 cents).
Pump prices are down in the vast majority of states (47) month-over-month and motorists in 36 states and Washington, D.C., are enjoying savings of a nickel or more per gallon over this same period. Averages have fallen by at least ten cents in more than half of the states (26), with the largest monthly savings experienced by drivers in Michigan (-43 cents), Illinois (-35 cents), Wisconsin (-35 cents) and Indiana (-34 cents). Consumers in a total of 14 states are saving a quarter or more at the pump over this same period. On the other end of the spectrum, drivers in Oregon (+2 cents), Washington (+2 cents) and New Jersey (+1 cents) are paying monthly premiums in the price of gas.
The relatively low price of crude oil continues to provide consumers with noticeable yearly savings in the price of retail gasoline. Pump prices are discounted by 75 cents per gallon or more in 26 states, and drivers in Alaska (-$1.15) and Hawaii (-$1.08) are saving more than $1 per gallon year-over-year. California (-36 cents) and Nevada (-42 cents) are the only two states where drivers are not saving at least 50 cents per gallon at the pump compared to one year ago.
Crude oil supply from a number of production countries including Russia and Saudi Arabia is expected to sustain the global oil market’s current oversupply and keep market fundamentals bearish in the near term. Projections of slower than expected economic growth from China, combined with the impact of a strengthening U.S. dollar, are also likely to keep the market out of balance and put a ceiling on global oil prices. When the value of the U.S. dollar increases, West Texas Intermediate crude oil, priced in U.S. dollars, becomes a relatively less attractive investment for those holding currencies overseas.
The latest data from the U.S. Energy Information Administration points to crude oil inventories being up more than 100 million barrels from this time last year. Domestic inventories are nearing all-time record levels, which contributed to WTI falling temporarily below $40 per barrel last week. WTI closed out Friday’s formal trading session on the NYMEX down 15 cents settling at $40.39 per barrel.
Motorists 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.
November 17th, 2015 by Amanda Shapiro
ORLANDO, Fla. (November 17, 2015) – AAA Travel forecasts 46.9 million Americans will journey 50 miles or more from home during the Thanksgiving holiday, a 0.6 percent increase over the 46.6 million people who traveled last year and the most since 2007. With 300,000 additional holiday travelers, this marks the seventh consecutive year of growth for Thanksgiving travel. The Thanksgiving holiday travel period is defined as Wednesday, November 25 to Sunday, November 29.
“This Thanksgiving, more Americans will carve out time to visit friends and family since 2007,” said Marshall Doney, AAA President and CEO. “While many people remain cautious about the economy and their finances, many thankful Americans continue to put a premium on traveling to spend the holiday with loved ones.”
Despite improvements in the economy, including steady wage growth, rising disposable income and a falling unemployment rate, consumers remain cautious about their finances. However, gas prices remain well below 2014 levels, providing an early holiday bonus to the more than 89 percent of holiday travelers who will drive to their destinations.
“One holiday gift has come early this year. Americans will likely pay the lowest Thanksgiving gas prices since 2008. Lower prices are helping boost disposable income, and enabling families to kick off the holiday season with a Thanksgiving getaway,” continued Doney.
Driving remains most popular mode of travel for Thanksgiving
Nearly 42 million Americans will take a holiday road trip this Thanksgiving, an increase of 0.7 percent over last year. Air travel is expected to increase by 0.1 percent, with 3.6 million Americans flying to their holiday destinations. Travel by other modes of transportation, including cruises, trains and buses, will decrease 1.4 percent this Thanksgiving, to 1.4 million travelers.
Lowest Thanksgiving gas prices in seven years expected
Drivers nationwide continue to experience significant yearly savings in the price of gas and AAA estimates that consumers are saving nearly $265 million on gasoline every day compared to a year ago. This has helped boost disposable income, enabling many Americans to travel this Thanksgiving. Most U.S. drivers will pay the lowest Thanksgiving gas prices since 2008. Today’s national average price for a gallon of gasoline is $2.15, 65 cents less than the average price on Thanksgiving last year ($2.80).
Airfares fall, hotel and car rental rates rise modestly
According to AAA’s Leisure Travel Index, airfares are projected to decrease 10 percent this Thanksgiving, landing at an average of $169 roundtrip across the top 40 domestic flight routes. Rates for AAA Three Diamond Rated lodgings are expected to remain relatively flat, with travelers spending an average of $155 per night. The average rate for a AAA Two Diamond Rated hotel has risen four percent with an average nightly cost of $118. Daily car rental rates will average $60, eight percent higher than last Thanksgiving.
#AAAToTheRescue for thousands of motorists this Thanksgiving
AAA expects to rescue more than 360,000 motorists this Thanksgiving, with the primary reasons being dead batteries, flat tires and lockouts. AAA recommends motorists check the condition of their battery and tires before heading out on a holiday getaway. Also, have vehicles inspected by a trusted repair shop, such as one of the nearly 7,000 AAA Approved Auto Repair facilities across North America. Members can download the AAA Mobile app, visit AAA.com or call 1-800-AAA-HELP to request roadside assistance.
Download the AAA Mobile app before a Thanksgiving getaway
Before setting out on a Thanksgiving trip, download the free AAA Mobile app for iPhone, iPad and Android. Travelers can use the app to map a route, find lowest gas prices, access exclusive member discounts, make travel arrangements, request AAA roadside assistance, find AAA Approved Auto Repair facilities and more. Learn more at AAA.com/mobile.
With the AAA Mobile app, travelers can also find more than 58,000 AAA Approved and Diamond Rated hotels and restaurants via TripTik Travel Planner. AAA’s is the only rating system that uses full-time, professionally trained evaluators to inspect each property on an annual basis. Every AAA Approved establishment offers the assurance of acceptable cleanliness, comfort and hospitality, and ratings of One to Five Diamonds help travelers find the right match for amenities and services.
AAA’s projections are based on economic forecasting and research by IHS Global Insight. The Colorado-based business information provider teamed with AAA in 2009 to jointly analyze travel trends during major holidays. AAA has been reporting on holiday travel trends for more than two decades. The complete AAA/IHS Global Insight 2015 Thanksgiving holiday travel forecast can be found here.
As North America’s largest motoring and leisure travel organization, AAA provides more than 55 million members with travel, insurance, financial and automotive-related services. Since its founding in 1902, the not-for-profit, fully tax-paying AAA has been a leader and advocate for the safety and security of all travelers. AAA clubs can be visited on the Internet at AAA.com. For more information about AAA Travel, visit AAA.com/Travel.
October 8th, 2015 by Amanda Shapiro
ORLANDO, Fla. (October 8, 2015) – A new analysis of AAA roadside assistance data reveals that millions of roadside breakdowns each year could be prevented with basic vehicle maintenance. Despite this, a recent AAA survey found that 35 percent of Americans have skipped or delayed service or repairs that were recommended by a mechanic or specified by the factory maintenance schedule.
“According to a survey of AAA’s certified Approved Auto Repair shops, consumers that forget or ignore recommended maintenance ultimately pay higher repair costs,” cautioned John Nielsen, AAA’s managing director of Automotive Engineering and Repair. “These repair facilities estimate drivers can save an average of one hundred dollars per visit simply by properly maintaining their vehicle.”
In 2014, AAA responded to more than 29 million calls for roadside assistance, with the majority (17 million) due to battery failure, flat tires and keys locked inside the vehicle. To prevent these common roadside problems, AAA offers the following recommendations:
- Batteries: Automotive batteries typically last between three and five years, with reduced battery life in hotter climates. To avoid an unexpected battery failure, AAA recommends that drivers have their vehicle’s battery tested when it reaches three years of age and on an annual basis thereafter. According to a recent survey, two thirds of Americans have never had their car battery tested prior to their vehicle failing to start. AAA’s Mobile Battery Service offers free battery testing to AAA members.
- Tires: Keeping tires properly inflated and routinely checking tread depth is critical to safety, yet AAA found that 60 percent of Americans do not check tire pressures regularly. Tire pressures, including the spare tire, should be checked at least once a month, and when tread depth reaches 4/32” AAA recommends replacing tires. Additionally, while locking lug nuts are helpful in preventing tire theft, missing keys prevented roadside assistance technicians from changing 21,000 tires in 2014. AAA recommends storing the locking lug nut key with the spare tire or in the glove box.
- Keys: Despite the rising popularity of Passive Keyless Entry systems, AAA has not seen a significant reduction in the number of calls related to drivers being locked out of their vehicle in the last decade, proving that it is difficult to prevent this common mistake.
“While problems with batteries, tires and keys are the most common reasons that members call AAA for help, there are more than 12 million calls each year related to engine trouble, fuel issues and other mechanical mishaps,” warned Nielsen. “AAA will always be there to save the day, but this study reveals drivers can save time and money by investing in routine maintenance.”
Other key findings from 2014 roadside assistance data include:
- AAA towed more than two million vehicles for engine-related issues and an additional 600,000 vehicles for transmission failure.
- More than 235,000 vehicles were towed due to brake system failures.
- While most modern vehicles are equipped with low-fuel lights, AAA provided gasoline fuel delivery to more than half a million vehicles in 2014.
- Due to members incorrectly fueling their gasoline-powered vehicle with diesel fuel, or vice-versa, AAA towed more than 13,000 vehicles to repair facilities.
“While today’s vehicle technology incorporates maintenance reminders and dashboard alerts designed to prevent roadside trouble, drivers still must take action,” cautioned Josh VanWynsberghe, AAA’s automotive technical engineer. “Finding a mechanic you trust and allowing that shop to perform all of your vehicle’s maintenance will result in improved reliability, higher resale values and increased safety.”
AAA’s Approved Auto Repair (AAR) program was created more than 35 years ago and includes nearly 7,000 facilities across North America. Once a shop meets AAA’s high standards, including certifications, technical training, cleanliness, insurance requirements and background checks, it becomes part of the AAR program where it’s re-inspected annually and monitored for customer satisfaction. AAA members receive several unique benefits by selecting an AAR facility, including priority service, a 24-month/24,000-mile warranty, discounts on repairs, free inspections, AAA assistance with dispute resolutions and more. To find an AAR facility, visit AAA.com/Repair.
As North America’s largest motoring and leisure travel organization, AAA provides more than 55 million members with travel, insurance, financial and automotive-related services. Since its founding in 1902, the not-for-profit, fully tax-paying AAA has been a leader and advocate for the safety and security of all travelers. AAA clubs can be visited on the Internet at AAA.com.
September 28th, 2015 by Amanda Shapiro
(WASHINGTON, September 28, 2015) The national average price for regular unleaded gasoline has remained relatively stable over the past week, reaching today’s price of $2.29 per gallon, following a decline of 37 consecutive days. Although today’s average is up by fractions of a penny compared to one week ago, pump prices have fallen for 26 of the past 30 days for a total monthly savings of 20 cents per gallon. This decline has been driven by relatively low crude oil prices, declining domestic demand for gasoline following the end of the summer driving season, and the switch to cheaper-to-produce winter-blend gasoline on September 16 in many parts of the country. Crude oil prices remain under downward pressure due to ample supply and seasonal declines in demand, and drivers continue to experience significant yearly savings in the price of retail gasoline. Pump prices are discounted by an average of $1.05 year-over-year and are at their lowest point for this date since 2004.
Falling averages are often the trend at this time of year due to a decline in driving and the switchover to winter-blend gasoline. Unlike previous years, refinery maintenance season this autumn is expected to be heavier than usual due to refineries operating at higher than normal rates for longer periods over the summer months. As the refinery maintenance season continues to ramp-up, gas price declines could slow and temporarily change direction. However, the market’s current oversupply is expected to keep prices relatively low, and barring any unexpected price spikes, consumers should continue to experience significant yearly savings at the pump approaching the end of the year.
Motorists in a total of five states are paying averages below the $2 per gallon benchmark. Drivers in South Carolina ($1.96) are paying the nation’s lowest averages at the pump, followed by: Mississippi ($1.96), New Jersey ($1.98), Alabama ($1.98) and Tennessee ($1.99). Alaska ($3.04) leads the market with highest price in the nation, and is the only state with an average price above $3 per gallon. Regional neighbors California ($2.99), Nevada ($2.94), Hawaii ($2.90) and Utah ($2.70) are the nation’s top five most expensive markets for gasoline.
Weekly price comparisons reveal a bit of volatility, with state averages moving by double-digit increments at both ends of the spectrum. Despite this fluctuation, overall savings persist and motorists in the majority of states (30 and Washington, D.C.) are experiencing weekly savings in the price to refuel their vehicles. Pump prices are discounted by a nickel or more per gallon in a total of 10 states, and the largest weekly savings in the price at the pump are seen in Alaska (-10 cents), Idaho (-8 cents) and Colorado (-8 cents). On the other end of the spectrum, averages have climbed higher in 20 states over this same period. The largest weekly increases in price are seen in the Midwestern states of Indiana (+13 cents), Kentucky (+9 cents) and Michigan (+9 cents).
Consumers nationwide are experiencing monthly savings at the pump, and prices in the majority of states (46 and Washington, D.C.) have fallen by double-digit increments over this same period. Drivers in a total of 10 states are benefitting from monthly savings of a quarter or more per gallon, with the largest savings at the pump seen in the West Coast states of Alaska (-38 cents), California (-37 cents), Oregon (-35 cents) and Washington (-34 cents).
Yearly price comparisons continue to reflect significant discounts in the price of retail gasoline. Averages are down year-over-year in every state and Washington D.C., and consumers in 33 states and Washington, D.C., are saving a $1.00 or more per gallon. Hawaii ($1.31), Connecticut ($1.23) and Vermont ($1.22) are posting the largest savings over this same period, and prices in 48 states and Washington, D.C., are discounted by at least 75 cents per gallon.
Uncertainty about global oil demand is reportedly impacting the price of crude, and both major benchmarks—Brent and West Texas Intermediate—opened Monday’s trading session with losses. China, which accounts for approximately 12 percent of the world’s total oil demand and frequently ranks as a top importer, announced plans to implement a national cap-and-trade program for carbon emissions. Although the impacts of the program on the crude oil market are unknown, a reduction in the country’s demand could further exacerbate the market’s current oversupply and put a ceiling on global oil prices.
The domestic oil market also remains in question, and the balance between supply and demand is expected to heavily influence North American oil prices. Domestic oil rig counts have reportedly fallen for the fourth week in a row, and according to the U.S. Energy Information Administration, sustained low oil prices could mark the beginning of a reduction in investment in exploration and production activities.
WTI closed out Friday’s formal trading session on the NYMEX up 79 cents, settling at $45.70 per barrel, but was last reported to be nearly a dollar lower this morning in early trading.
Motorists 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.
September 21st, 2015 by Amanda Shapiro
(WASHINGTON, September 21, 2015) Today’s national average price for regular unleaded gasoline marks the lowest price for this date since 2004, and prices continue to march lower. The national average has dropped for 35 consecutive days for a total savings of 38 cents per gallon over this span. Today’s average price of $2.29 per gallon represents a weekly savings of four cents per gallon and a monthly savings of 33 cents per gallon. Motorists are saving $1.05 per gallon compared to one year ago, largely due to the relatively low price of crude oil and abundant petroleum supplies.
In addition to the seasonal switchover to less expensive winter-blend gasoline, the fall months are also a time when refineries go offline to conduct seasonal maintenance. This is intentionally scheduled during the months when demand for gasoline and heating oil is relatively low, and it is not uncommon for pump prices to decline during this time of year due to decreased driving demand and the cost savings associated with winter-blend gasoline.
This past summer was characterized by relatively high driving demand and refineries operated at higher capacities for longer periods of time. As a result, many are expecting the fall maintenance season to be heavier-than-usual. Barring any unexpected spikes in the price of crude, retail averages are not expected to climb this fall due to the market’s current oversupply.
The majority of consumers nationwide are continuing to see falling prices at the pump. Alaska ($3.13), California ($3.06) and Nevada ($3.00) are the market leaders and the only three states with averages above $3 per gallon. On the other end of the spectrum, a total of five states are posting averages below $2 per gallon: South Carolina ($1.90), Mississippi ($1.93), Alabama ($1.95), Tennessee ($1.99) and Louisiana ($1.99).
Pump prices are down in 47 states and Washington, D.C. in comparison to one week ago, with the motorists in the majority of these states (34 and Washington, D.C.) saving at least a nickel per gallon. Drivers in six states are benefitting from double-digit savings in the price of retail gasoline, with the largest discounts over this period seen in Alaska (-15 cents), South Dakota (-11 cents) and California (-11 cents). The Midwestern states of Indiana (+10 cents), Michigan (+ 8 cents) and Ohio (+7 cents) are the only three states outside of this trend, and prices have moved higher week-over-week. Prices in the Midwest have consistently been among the most volatile in the nation over the past several years, and while prices are up on the week, these same three states are among those posting the largest declines over the weeks prior.
With the exception of Utah (-4 cents), retail averages are discounted by double-digit increments in every state and Washington, D.C. month-over-month. The largest savings at the pump are seen in states where averages continue to move lower following the resolution of localized refinery issues : Illinois (-62 cents), Indiana (-56 cents), Michigan (-54 cents) and Wisconsin (-52 cents). Consumers in 33 states are saving a quarter or more per gallon to refuel their vehicles.
Year-over-year savings in the price of retail gasoline continue to widen nationwide, and motorists in 36 states and Washington, D.C. are saving at least a $1 per gallon. Consumers in Hawaii (-$1.32) and Connecticut ($1.21) are saving the most per gallon over this same period and 22 states are posting yearly savings of $1.10 or more per gallon. Nevada (-57 cents) and California (-68 cents), the only two contiguous states with averages above $3 per gallon, are also the only two states where drivers are not experiencing yearly savings of at least 75 cents or more at the pump.
The global oil market appears to be holding steady, following the Federal Reserve’s decision to leave interest rates unchanged. The Fed has kept interest rates near zero since 2008 in an effort to help stimulate economic growth. Raising U.S. interest rates often causes the U.S. dollar to gain strength, which makes oil more expensive for countries holding other currencies.
Oversupply characterizes the domestic oil market and attention remains focused on oil inventories and reports of production declines and falling oil rig counts. WTI closed out Friday’s formal trading session down $2.22, settling at $44.68 per barrel.
Motorists 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.
September 14th, 2015 by Amanda Shapiro
(WASHINGTON, September 14, 2015) Falling gas prices continue to benefit motorists with three southern states posting averages below $2 per gallon: South Carolina, Mississippi, and Alabama. This is the first time that three states have had averages below $2 since February. The national average price for regular unleaded gasoline has fallen for 28 consecutive days, reaching today’s price of $2.33 per gallon. Drivers are saving six cents per gallon compared to one week ago and 33 cents versus one month ago. Gas prices remain much cheaper than last year due to the relatively low price of crude oil with drivers saving an average of $1.06 per gallon compared to a year ago.
Barring any unexpected disruptions in supply or spikes in the price of crude oil, the national average is expected to keep moving lower as we head into the fall. Pump prices typically decline during this time of year due to lower driving demand after the busy summer driving season and the changeover to cheaper to produce winter-blend gasoline, which takes place in many parts of the country starting on September 16. U.S. drivers continue to benefit from an oversupplied market and consumers could experience even lower prices at the pump if the price of crude oil remains relatively low and refineries are able to conduct planned seasonal maintenance without issue.
On the whole, retail averages are down nationwide, including the three states — South Carolina ($1.94), Mississippi ($1.99), and Alabama ($1.99) — where averages are back below $2 per gallon. The most expensive markets for retail gasoline are west of the Rockies, with drivers in Alaska ($3.28) continuing to pay the highest averages at the pump. Regional neighbors California ($3.17), Nevada ($3.06), Hawaii ($2.97) and Idaho ($2.81) are the top five most expensive markets for gasoline.
With just one exception, motorists in every state are experiencing savings in the price of retail gasoline week-over-week. Averages are down by a nickel or more in 30 states and Washington, D.C., and pump prices in Indiana (-14 cents), Illinois (-13 cents), California (-10 cents) and Michigan (-10 cents) have dropped by double-digit increments over this same period. Outside of this trend is Ohio, where prices have climbed higher by three cents per gallon versus one week ago.
Monthly price comparisons show consumers nationwide are paying less to refuel their vehicles. With the exception of Utah (-2 cents), drivers across the nation are saving more than a dime per gallon at the pump month-over-month and prices are discounted by a quarter or more per gallon in more than half (26) of the states. The largest discounts in price over this same period have been in the Midwestern states of Indiana (-81 cents), Michigan (-75 cents), Ohio (-66 cents) and Illinois (-62 cents), where prices continue to retreat following the resolution of localized refinery issues.
Yearly discounts are widening even further, with drivers in the majority of states (35) saving at least $1 per gallon at the pump. The largest yearly savings are in Hawaii (-$1.30), Indiana (-$1.27), and Michigan (-$1.24), and prices are down 75 cents or more in 47 states and Washington, D.C. Market leaders Nevada (-58 cents), California (-62 cents) and Alaska (-69 cents) are outside of this trend.
The global oil market remains volatile and the overall sentiment continues to swing between bulls and bears in response to recent reports. The International Energy Agency is predicting that production from non-OPEC countries will fall by its largest increment in 24 years, and the organization attributes this decrease to the success of OPEC’s strategy to protect its market share by sustaining production despite the relatively low price of crude oil. Also according to IEA, global oil demand is expected to increase in 2016. The combination of lower production and higher demand is reportedly contributing to the sentiment that a bullish market could be on the longer-term horizon.
In what is being described as its latest play to remain influential over global oil markets, OPEC welcomed Indonesia back into the cartel, making the Southeast Asian nation the only member country that is not a net exporter. Indonesia was a member of the cartel for 47 years and suspended its membership in 2009 when its balance between consumption and production shifted. OPEC is next scheduled to meet in December in Vienna, and during this meeting the country will officially rejoin as a member. At present, the oil cartel does not plan to convene prior to the December meeting to discuss strategy, and the global oil market is likely to remain bearish in the near term.
The domestic oil market remains oversupplied, and according to the most recent report from the U.S. Energy Information Administration, oil inventories continue to build despite domestic production declines. The price of West Texas Intermediate crude oil, the traditional U.S. benchmark, is expected to remain relatively low as seasonal refinery maintenance gets underway and demand for gasoline decreases as we enter the fall.
WTI closed out Friday’s formal trading session on the NYMEX down $1.29, capping a loss of nearly three percent for the week, and settled at $44.63 per barrel.
September 8th, 2015 by Amanda Shapiro
(WASHINGTON, September 8, 2015) The 2015 summer driving season ended with the national average at its lowest point for the Labor Day holiday in more than a decade. Motorists paid an average price of $2.40 per gallon at the pump yesterday, a savings of $1.04 per gallon in comparison to last year’s holiday. The national average price for regular unleaded gasoline has fallen 22 consecutive days for a total of 28 cents per gallon, reaching today’s average of $2.39 per gallon. Drivers are saving seven cents per gallon versus one week ago and 20 cents versus one month ago. Yearly price comparisons continue to reflect savings of more than $1 per gallon, with today’s price discounted by $1.05 versus this same date last year.
Motorists have enjoyed lower prices at the pump throughout this summer, with an average savings of 89 cents per gallon compared to last year’s summer driving season, which typically runs from Memorial Day to Labor Day. These lower prices have encouraged motorists to hit the road in record numbers and meant some of highest demand numbers over the first eight months of 2015. Prices are expected to continue to slide as driving demand experiences a seasonal decrease heading into the fall, provided the price of crude remains relatively low and refineries are able to conduct routine maintenance without issues. According to the U.S Energy Information Administration, refineries reported higher than normal utilization rates and more maintenance is scheduled for this year compared to previous years. This could slow the rate of anticipated declines in the price at the pump; however, it is not expected to cause a reversal of direction.
The conclusion of the summer driving season also signals the start of the seasonal switchover to winter-blend gasoline in many parts of the country on September 16. The Environmental Protection Agency requires certain areas to use a specified blend of gasoline, commonly referred to as summer-blend gasoline, in order to address air quality issues during the summer months. This more expensive summer-blend gasoline is not required during the winter months and prices tend to fall following the completion of this seasonal switchover.
The highest retail averages are found in states west of the Rockies, and drivers in Alaska ($3.35) are paying the most per gallon at the pump. A total of four states are posting averages above $3 per gallon, and regional neighbors California ($3.26), Nevada ($3.10), Hawaii ($3.03), and Washington ($2.88) round out the top five most expensive markets for gasoline. Pump prices slipped below $2 per gallon in South Carolina, the nation’s least expensive market for gasoline, over the weekend and drivers are currently paying an average price of $1.97 per gallon.
With the exception of Delaware (+4 cents) and Utah (fractions of a penny), retail averages are down in every state and Washington, D.C. week-over-week. Weekly price comparisons reveal that motorists in more than half of the country (26 states) are saving a nickel or more per gallon at the pump and prices are discounted by double-digits in five states. The largest savings over this same period are seen in states previously impacted by the Whiting, Indiana refinery outage and where prices are now falling as production at the facility has restarted: Indiana (-17 cents), Ohio (-15 cents), Illinois (-14 cents) and Michigan (-12 cents).
Consumers nationwide are paying less per gallon to refuel their vehicles versus one month ago. Retail averages are down by a dime or more per gallon in 43 states and Washington, D.C. over this same period, and motorists in eight states are saving a quarter or more per gallon at the pump. The most significant monthly discounts in price are seen in California (-33 cents), Oregon (-29 cents) and New Jersey (-27 cents).
Prices remain markedly lower year-over-year in every state, and averages are discounted by at least 75 cents per gallon in 47 states and Washington, D.C. Market leaders Alaska (-67 cents), California (-56 cents) and Nevada (-59 cents) are the only states to buck this trend. Pump prices are discounted by $1 or more per gallon in 33 states, with the largest savings over this same period reflected in the Midwestern states of Indiana (-$1.28), Michigan (-$1.26) and Ohio (-$1.26).
While prices have been volatile in recent weeks, a long-term bearish sentiment continues to underscore the global oil market as speculation about the balance between supply and demand from emerging economies remain front of mind. A small group of oil ministers from both OPEC member countries and non-OPEC member counties located in the Persian Gulf are scheduled to meet this week, and although oil prices are not officially on the agenda, the market will closely monitor developments for any clues about OPEC’s plans for production.
The domestic oil market has been described as bullish in recent trading sessions, after posting gains upwards of 20 percent following a multi-year low of $38.60 per barrel (August 26). Despite this recent jump, the price of WTI is likely to face downward pressure due to seasonal declines in demand and reduced crude oil purchases by refineries, both capable of further exacerbating the imbalance between supply and demand.
WTI opened today’s trading session down approximately 60 cents per barrel, after closing Friday’s formal trading session on the NYMEX down 70 cents, settling at $46.05 per barrel.
September 3rd, 2015 by Amanda Shapiro
AAA Monthly Gas Price Report: Sept. 3, 2015
Americans to Pay Lowest Labor Day Gas Prices Since 2004
- Most U.S. drivers will pay the lowest gas prices since 2004 for the busy Labor Day weekend. Today’s national average price of gas is $2.44 per gallon, which is 99 cents per gallon less than a year ago. U.S. consumers should save more than $1 billion on gasoline over the holiday weekend compared to 2014, with many drivers saving about $15-$25 on every trip to the gas station.
- “Americans should find good deals on gas prices in most parts of the country heading into the busy Labor Day weekend,” said Avery Ash, AAA spokesman. “It is unbelievable that drivers are ending their summer vacations with the lowest gas prices for this time of year in more than a decade.”
- Average U.S. gas prices have dropped about 37 cents per gallon since hitting a 2015 peak price of $2.80 on June 15. Average gas prices have dropped due to lower crude oil costs and abundant petroleum supplies.
- Gas prices averaged $2.60 per gallon in August, which was the lowest average for the month since 2005. The average price in August was about 15 cents per gallon less than in July.
- Gas prices remain relatively high compared to the cost of crude oil. WTI oil prices closed at $46.25 per barrel yesterday, which was similar to the cost of oil in January. Nevertheless, average gas prices are about 41 cents per gallon more expensive than the lowest daily average in January. Gas prices are higher than would otherwise be expected due to high demand and ongoing refinery problems, along with the higher cost to produce summer-blend gasoline that is required in many areas. When the market is running smoothly, gas prices generally drop about 2.4 cents per gallon for every $1 per barrel change in the cost of crude oil.
- Summer is the busiest time of the year for driving and millions of Americans are taking advantage of lower gas prices to travel more this year. New estimates by the Federal Highway Administration showed that U.S. driving topped 1.54 trillion miles in the first half of 2015, which was an all-time high. Increased driving results in higher fuel demand, which can lead to higher gas prices.
- A number of major refineries have experienced production problems this year, which has led to significantly higher regional prices when combined with high fuel demand. In August, BP’s refinery in Whiting, Ind. was forced to shut its largest crude distillation unit temporarily. Gas prices across the Midwest jumped in response with averages in some Great Lakes states up more than 50 cents per gallon in less than a week. BP was able to repair the facility faster than expected, and prices have returned nearly all of those gains, though at a much slower pace than the initial price spike.
- Gas prices remain relatively high on the West Coast, in part because ExxonMobil’s refinery in Torrance, Calif. is still not operating at normal levels. The refinery experienced an explosion in the spring that sent gas prices in parts of California above $4 per gallon. Gas prices have since declined as supplies enter the market form other areas, yet gas prices in California and neighboring states remain near or above $3 per gallon. The refinery reportedly will ramp up in production in October as it completes repairs.
- Oil prices have experienced dramatic price swings in recent weeks. The cost of West Texas Intermediate crude oil closed at a high for the year of $61.43 per barrel on June 10. On August 24, the cost of crude oil dropped to $38.24 per barrel, which was the lowest closing price since early 2009. Oil prices have since moved upwards on updated domestic production data and rumors that OPEC may curtail production.
- Oil remains much cheaper than in recent years because of abundant supplies. Growing concerns about the Chinese economy, the likelihood of Iranian oil entering the market and strong domestic production have helped lower oil prices since June. The dramatic growth in the Chinese economy helped drive commodity prices higher in recent years, while the recent economic slowdown has helped to lower prices. Iran promises to unleash as much as a million barrel per day of oil into the market if economic sanctions on the country are lifted. Meanwhile, domestic crude oil production remains nearly 13 percent higher than a year ago, and U.S. commercial supplies are about 27 percent higher than a year ago.
- The average price of diesel was cheaper than gasoline for six days in August for the first time since 2009, due to seasonal factors and the elevated cost of gasoline. Today’s average price of diesel is $2.57 per gallon.
Gas Prices Could Fall Below $2 per Gallon by Christmas
- “Gas prices in many parts of the country could fall below $2 per gallon by Christmas if the cost of crude oil remains low,” continued Ash. “There is good reason to believe that cheaper oil costs, a seasonal decline in driving and the switchover to less costly winter-blend gasoline will continue to push down prices through the end of the year.”
- Gas prices generally drop after Labor Day, which is considered the end of the summer driving season. People typically drive less in the autumn and winter, which is when gas prices usually reach a low for the year.
- Refinery maintenance this autumn could slow, but not stop a decline in gas prices. Refineries typically conduct maintenance in the autumn and spring when demand for gasoline, diesel and heating oil is relatively low. Even as refineries conduct maintenance, gasoline supplies should continue to outstrip demand unless there are unexpected problems.
- Many parts of the country can switch over to less expensive, winter-blend gasoline on September 16. The EPA requires that parts of the country use summer-blend gasoline during hot-weather months to improve air quality, but this fuel is unnecessary once temperatures begin to cool. Occasionally, gas prices can increase temporarily in the days leading up the switchover deadline as supplies of remaining summer-blend gasoline tighten.
- Crude oil remains the primary wildcard in determining future gas prices. If OPEC cuts production, the Chinese economy grows stronger or if Iranian oil is unable to enter the market, then oil prices could rise and push up the cost of gasoline. There also is a possibility that oil prices could drop further in the coming months given the weaknesses in the global economy and because refineries conducting maintenance will need less crude oil.
- The price of oil briefly dipped below $40 per barrel last week. Historically, sustained oil prices below $40 per barrel have resulted in a national average price of gas below $2 per gallon.
- There is always the possibility that gas prices could rise due to a number of factors, such a major hurricane striking the U.S. Gulf Coast, higher crude oil prices or unexpected refinery problems.
Gas Under $2 per Gallon Growing More Common in the Southeast
- More than five percent of all U.S. stations are selling gas for less than $2 per gallon and those numbers are growing every day. Last year at this time there were zero stations selling gas under $2 per gallon.
- The average price of gas in South Carolina is $2.00 per gallon, and will likely fall below that mark before Labor Day weekend begins. Average prices in Alabama and Mississippi also may fall below $2 per gallon over the next week. The last time any state had an average below $2 per gallon was on February 26, when both Idaho and Utah were below that mark.
- The five most expensive state averages include: Alaska ($3.40), California ($3.31), Nevada ($3.11), Hawaii ($3.08) and Washington ($2.92). The states with the lowest average gas prices include South Carolina ($2.00), Alabama ($2.06), Mississippi ($2.06), Tennessee ($2.14) and Louisiana ($2.16).
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.
August 24th, 2015 by Amanda Shapiro
(WASHINGTON, August 24, 2015) Average U.S. gas prices today are at the lowest levels for this time of year since 2004 due to the steep decline in the cost of crude oil. Gas prices have dropped recently despite ongoing refinery problems, and prices should continue to fall this autumn due to declining demand and the switchover to winter-blend gasoline. Today’s national average price of gas is $2.59 per gallon, which is eight cents less than a week ago and 84 cents less than a year ago. Pump prices are now 21 cents per gallon below the 2015 peak price reached on June 15.
BP’s largest crude distillation unit at its Whiting, Indiana refinery remains out of commission, due to a malfunction reported on August 8 that triggered dramatically higher prices in the Great Lakes region. Repairs to the unit are reported to be ongoing, and the company has yet to release a date they expect the unit to return to production. However, BP has purchased additional fuel supply and met all of its contractual requirements to date. Although regional supply is still uncertain due to the outage, prices in the region have moved lower over the past week as speculation has built that supply issues might not be as dire as first worried.
Motorists in the Pacific Northwest continue to pay the nation’s highest averages, with five of the six states with averages above $3 per gallon located in this region. California ($3.47) leads the market, and is followed by regional neighbors Alaska ($3.43), Nevada ($3.18), Hawaii ($3.17) and Washington ($3.04) as the nation’s most expensive markets for retail gasoline. Drivers in South Carolina ($2.11) are paying the lowest average at the pump.
Weekly price comparisons continue to reflect volatile fluctuations in the balance between regional supply and demand. Just a week after Midwestern drivers were reeling from sharply higher pump prices, motorists in these same states have seen prices plummet week-over-week: Indiana (-19 cents), Ohio (-19 cents), Michigan (-19 cents), and Illinois (-13 cents). Consumers in 30 states are experiencing weekly savings of at least a nickel per gallon at the pump and a total of seven states are posting double-digit savings over this same period. Prices in every state are lower today than one week ago.
Retail averages are down in 44 states and Washington, D.C. month-over-month. The largest discounts in the price of retail gasoline were in California (-36 cents) and New Jersey (-25 cents). Consumers in 33 states and Washington, D.C. are enjoying monthly savings of a dime or more per gallon at the pump. On the other end of the spectrum, retail averages have moved higher in six states over this same period. Prices are double-digits higher in five Midwestern states compared to one month ago: Indiana (+30 cents), Illinois (+26 cents), Michigan (+17 cents), Ohio (+16 cents), and Wisconsin (+16 cents).
Year-over-year discounts in the price of retail gasoline persist, largely due to the price of crude being significantly discounted from this date in 2014. Pump prices in nearly every state (48 and Washington, D.C.) are more than 50 cents per gallon lower than this same date last year. Motorists in 12 states are saving $1 or more per gallon in the average price to refuel their vehicles.
Crude oil prices have continued to sag, due to persisting global oversupply and concerns about the health of the Chinese economy. China is one of the world’s largest and most rapidly growing economies. Evidence of slower than projected growth in the Chinese economy is rippling through global markets and has put additional downward pressure on the price of crude. Both crude oil benchmarks (Brent and West Texas Intermediate) ended last week at their lowest levels since March 2009, and the market is expected to remain volatile in the near term. At the close of Friday’s formal trading on the NYMEX, WTI settled at its lowest close since March 2, 2009 down 87 cents at $40.45 per barrel. These losses accelerated today as WTI opened the week trading $1.50 per barrel lower, well below the $40 per barrel threshold.
August 17th, 2015 by Amanda Shapiro
(WASHINGTON, August 17, 2105) The national average price for regular unleaded gasoline ended a 27-day streak of daily declines last week and has since increased for six straight days. Today’s average price of $2.67 per gallon is an increase of eight cents per gallon versus one week ago, due largely to a new refinery problem in the Midwest. Despite recently rising prices, drivers are saving nine cents per gallon month-over-month and continue to enjoy significant yearly savings with today’s average discounted 79 cents per gallon versus this same date last year.
Motorists in the Midwest are familiar with volatile prices during the summer driving season, yet it is very rare to see the magnitude of the price jumps that occurred over the past week, particularly in Indiana, Illinois, Michigan, Ohio and Wisconsin. Prices in the region moved markedly higher on the heels of news that BP had unexpectedly shutdown the largest of its three crude distillation units (CDU) at its Whiting, Indiana refinery on Saturday, August 8 for unscheduled repair work. The refinery is capable of producing 430,000 barrels of refined product per day, and the shutdown of the facility’s CDU has noticeably impacted supply within the region. BP is reportedly working to meet its fuel supply obligations and has yet to report when it expects the unit to resume production, though initial reports indicate it may take a month or longer to repair. While the Great Lakes region has experienced the largest price increases, drivers in neighboring states and in the Central United States also have seen prices rise over the past week in response to this latest refinery problem.
Retail averages on the West Coast also remain volatile due to changes in the balance between supply and demand. California ($3.58) remains the nation’s most expensive market for retail gasoline, and is joined by Alaska ($3.47), Nevada ($3.22), Hawaii ($3.20) and Illinois ($3.16) as the nation’s top five most expensive markets. Consumers in South Carolina ($2.18) and Alabama ($2.21) are paying the nation’s lowest averages at the pump.
Week-over-week the average price at the pump has climbed higher in 20 states. Pump prices in the Midwest have skyrocketed due to the aforementioned refinery issues. Motorists in Indiana have seen prices jump by 59 cents per gallon over this period, and similar price surges occurred in the neighboring states of Illinois (+56 cents), Michigan (+51 cents), Ohio (+44 cents) and Wisconsin (+39 cents). On the other end of the spectrum, prices are down in 30 states and Washington D.C., and have fallen in a less dramatic fashion with the largest declines in New Jersey (-5 cents), Rhode Island (-5 cents) and Delaware (-5 cents).
Drivers in the majority of states are experiencing monthly savings at the pump. Retail averages have moved lower in 39 states and Washington, D.C., month-over-month, and price comparisons in 30 states and Washington, D.C., are reflecting double-digit savings. The largest discounts in price over this same period are in California (-30 cents), Delaware (-23 cents) and North Carolina (-21 cents). Motorists in 11 states are paying monthly premiums at the pump, led by Indiana (+38 cents), Illinois (+32 cents), Michigan (+26 cents), and Wisconsin (+25 cents).
The relatively low price of crude remains evident in the significant year-over-year savings at the pump. Pump prices are discounted by $1 or more in five states compared to this same date last year: Hawaii (-$1.11), Connecticut (-$1.06), Vermont (-$1.06), Alabama (-$1.00) and New Hampshire (-$1.00), and drivers in more than half of states (34 states and Washington, D.C.) are enjoying yearly savings of 75 cents or more per gallon.
Market fundamentals continue to support the price of crude moving lower in the near term due to global oversupply. In addition to reports confirming the likelihood of sustained production from both OPEC and higher cost production countries like the United States, which has kept downward pressure on the price of crude, the market is now responding to reports that the Japanese economy is shrinking. Both exports and consumer spending fell in Japan from April to June, which has been viewed as yet another signal that supply will likely outpace demand in the near term.
West Texas Intermediate opened the week trading at a six-year low due to this evidence of continued global crude oversupply and weakening economies. This comes on the heels of WTI closing out last week at $42.50 per barrel, up slightly on the day.