Posts Tagged ‘Fuel Gauge Report’

Washington, D.C., (March 23, 2012) – With prices climbing more than 60 cents a gallon since January 1, President Barack Obama discussed energy and rising gas prices—a top-of-mind issue for motorists across the country including AAA’s more than 53 million members—in a meeting with AAA yesterday.

Following his speech on energy issues in Cushing, Oklahoma, the President spoke to a representative of the nation’s largest auto club that serves one-in-four American households.

As an advocate of motorists nationwide, AAA asked the President questions likely to be foremost in the minds of drivers feeling the pain at the pump.

Additional Resources

When asked by AAA to comment on the frustration and confusion that U.S motorists are experiencing with rising gas prices, the President said, “I understand what folks are going through because it wasn’t that long ago that I was having to fill up my gas tank and drive to work, shuttle the kids back and forth to school or events. It takes a big bite out of folks’ paychecks.”  The President went on to say that the U.S. has experienced cyclical gas prices for decades and stressed the importance of America having more control over its own energy security.

AAA also inquired about the role of the President in addressing prices at the pump given the global forces and political tensions abroad that drive the oil and energy markets.  The President elaborated on points from his earlier speech, saying, “The most important thing I can do as the President is not to simply focus on tomorrow.  It’s focusing on getting America properly aimed toward our goal of continuing to reduce our dependence on foreign oil.”  The President also highlighted the importance of maintaining growth and productivity while further reducing U.S. oil consumption.  Mr. Obama noted that pressure on oil prices in the coming two decades will be difficult to reverse.

Even as a 110-year old organization whose origins date to the earliest days of the motor vehicle, AAA continues to explore new vehicle technologies to offer enhanced and improved services to members. Responding to member interest, AAA began testing a roadside service vehicle capable of providing charging assistance to electric vehicles.

As to public acceptance of new technologies, the President said, “People need to feel confident that when they get into an electric car they’re not going to get stuck. To the extent that we start having both more efficient batteries and distribution capacity, people can feel confident that they’re never going to get stuck, or at least not any more stuck than they do when they forget to fill up and then call AAA.”

The President also shared insight about the role of alternative-fuel vehicles as a possible solution to current high fuel costs.  Mr. Obama noted that fuel efficiency standards for cars and trucks have doubled, which will result in fewer trips to the gas station and a savings for the average family of about $8,000 over the life of the car. As to the future, Mr. Obama is optimistic. “If we unleash American creativity, if we properly incentivize people to think about fuel economy as part of overall design, Americans can make great cars.”

While Mr. Obama is no longer able to do his own driving, AAA couldn’t pass up the opportunity to ask President Obama about his first car.  Noting he had been a AAA member for years , he said, “I have to confess, my first car was my grandfather’s car, which was a Ford Granada. It rattled and it shook, and I don’t think the girls were particularly impressed when I came to pick them up in a Ford Granada.  But you know what?  It moved, and so I have fond memories of the fact that it got me to where I needed to go.”

AAA is a non-partisan organization providing unbiased reporting of gas prices through its popular weekly Fuel Gauge Report, and supports the national dialogue on gas prices by offering objective and accurate perspective to the media and motorists year-round.

As North America’s largest motoring and leisure travel organization, AAA provides more than 53 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.

 

Full Transcript:

AAA EXCLUSIVE INTERVIEW WITH PRESIDENT BARACK OBAMA (Cushing, Oklahoma – March 22, 2012) 

President Obama sat for an exclusive interview with Yolanda Cade, AAA’s managing director of public relations, in Cushing, Oklahoma to speak directly to AAA’s 53 million members on the topic of high gasoline prices. 

 AAA: As you know, AAA proudly serves 53 million members, many of them, like most Americans are confused and they’re frustrated about the rising gas prices. So what would you say to drivers that are feeling that pain in the pocketbook when they’re filling up at the pump?

President Obama: Well, first of all, I understand what folks are going through, because it wasn’t that long ago that I was having to fill up my gas tank and drive to work, shuttle the kids back and forth to school and their events, and it takes a big bite out of folks’ paychecks. The challenge is that we’ve been going through this kind of cycle of ups and downs in gas prices for decades now.  We don’t have the control over our own energy security the way we need to. And so what we talked about today was an all of the above strategy that involves higher oil production here in the United States but also involves making our cars more fuel efficient, expanding biofuels, using all the resources we can to try to lessen our demand for foreign oil, which makes us less vulnerable to price spikes over the long term.

Right now the key thing that is driving higher gas prices is actually the world’s oil markets and uncertainty about what’s going on in Iran and the Middle East, and that’s adding a $20 or $30 premium to oil prices, and that affects obviously gas prices. What’s also driving it, and this is something that’s not going to reverse, is increasing demand in countries like China and India.  In 2010, for example China added 10 million cars just in that one year. So as more and more people around the world see their standards of living rising, they purchase cars, they have demand for oil, that creates a greater demand worldwide and that raises the price.  That’s why we’ve got to make sure that we don’t just focus on production.  We’ve also got to focus on fuel efficiency; we’ve also got to focus on alternatives.  If we don’t, we’re going to continue to be subject to these kinds of price spikes anytime something happens around the world.

AAA: And just to pick up on that thread, talking about global forces – and you alluded to that today – given the global forces that are driving the oil and energy markets, what is the role of the President, if any, in addressing the price of gasoline that Americans are paying at the pump? 

President Obama: Well, there are a couple of things that we can do right now.  There are some bottlenecks in distribution that we’re trying to impact, and building this pipeline from Cushing down to the Gulf is an example of where you get more oil to refineries faster that can hopefully be distributed more efficiently across the country.  We are looking at making sure that we’re enforcing laws preventing illegal speculation in the oil markets.  That can have some modest impact potentially, if something is going on there that shouldn’t be going on.  But the most important thing I can do as a President is not to simply focus on tomorrow; it’s focusing on getting America properly aiming towards our goal of continuing to reduce our dependence on foreign oil. And we’ve had success over the last three years, we’ve actually seen every year our oil imports decline even as we climbed out of a recession so the economy was growing.  We’ve now doubled fuel efficiency standards on cars and trucks, and by the middle of the next decade we can expect the average car to be getting 55 miles per gallon.  And that’s going to mean you only take one trip to the gas station instead of two, and could end up saving the average family about $8,000 during the life of their car.  That would obviously be a big help.  So, those are the kinds of strategies that I have the most control over, not the day-to-day spikes in the oil market.

AAA: And you talked about the economy, and if I can follow up on that there are signs that the American economy is improving.  Do you have any concerns that the rising gas prices may at some point stifle the recovery?

President Obama: Well we saw that happen last year, where consumer confidence was building and then suddenly pulled back sharply.  People are very sensitive to oil prices.  The one thing that I think is important for us to remind voters, and I know this is a small consolation, but the payroll tax cut that we passed at the beginning of this year and then we’ve now extended to the end of the year, saves the average family about $1,000 a year. And that is helping to buffer some of these rising gas costs.  So some of this we anticipated, and we said to ourselves: that’s part of the reason why we’ve got to make sure we continue to extend this tax cut at least through the end of this year so that we don’t see as much of an impact on what people actually have in their pockets as there would have been if they were socked with both a tax increase and rising gas prices at the same time.

AAA: Mr. President, you’ve advocated increased fuel economy and you talked about the fact that it is really an integral part of the solution to our overall energy needs.  And then today we heard you talk about the importance of infrastructure and continued innovation.  But speaking of balance: how do you effectively balance fuel efficiency and ensure there is appropriate infrastructure and at the same time preserve consumer vehicle choice?

President Obama: Well look, one of the great things we’ve been doing with the auto industry over the last couple of years is not only are we producing more fuel efficient cars, but they’re better cars, more attractive cars, and safer cars.  What we’ve been arguing consistently is that if we unleash American creativity, design, we properly incentivize people to think about fuel economy as part of overall design, Americans can make great cars.  And if you look at the cars that are being built in Detroit right now, they’re getting more gas mileage, they’re safer than they were – they’re not compromising on styling – and part of that is everything from figuring out the aerodynamics, to tire drag, to air conditioning systems that are more efficient.  All those things, all those technological advances, are making a difference and we are continuing to spur advanced technology improvements in our auto vehicles.  That includes conventional cars, but it also includes electric and hybrid cars.

So, I’ll give you a small example.  We’ve recently provided a $4 million grant to a company that it appears may have gotten a breakthrough on battery technology that could actually reduce the cost and expand the power of the batteries that are used in electric cars two-fold.  That could bring down the price point.  That could make the capacity to run further on a single charge much greater.  It could reduce the amount of room that a battery takes up in a car.  So all of that could make a huge difference in terms of us and Detroit being able to produce the very best, most fuel efficient cars in the world.

AAA: And in anticipation of that, at AAA, we’re actually pilot testing delivering energy at the roadside, delivering an electric charge to electric vehicles.  And speaking of American creativity and design ingenuity in electric vehicles, you said that when you leave office, that you will buy and drive a Chevy Volt.  So what role then do you think that electric vehicles and other alternative vehicles help in preventing the kind of gas price fluctuations that we’re now seeing?  What role do you think they’ll play in the future?  Do you think they’ll play an integral role?

President Obama: Look, you identified the big challenge.  That is, people need to feel confident that when they get into an electric car that they’re not going to get stuck because of range anxiety – and so to the extent that we start having both more efficient batteries but also distribution capacity, so that people feel confident that they’re never going to get stuck, or at least not any more stuck than they do when they forget to fill up and then they call AAA.  Then I think that we can see a substantial expansion in the use of electric vehicles over the future, and anything that we’re doing to reduce oil consumption, while maintaining our growth and productivity, that’s all good.  Because frankly, the pressure on oil prices to go up over the coming two decades is going to be very difficult to reverse.  You’ve got hundreds-of-millions of people in China, hundreds-of-millions of people in India, billions of people around the world, who want the same stuff we’ve got.  They aspire to the same standard of living and having a car as we do.  Demand is going to outstrip supply.  We’ve got to come up with new technologies.  That’s what we’re going to be working on.

AAA:  Finally, Mr. President, and we’ve asked this of others in your Administration, tell us, what was your first car and do you have any fond memories of your driving experience that you’d like to share with us?

President Obama:  Well, first of all, I was a AAA member for years, up until they [Secret Service] told me I couldn’t drive anymore.  But I have to confess; my first car was my grandfather’s car, which was a Ford Granada.  Now Ford is doing great now.  The Ford Granada was not the peak of Detroit engineering.  It rattled and it shook, and I don’t think the girls were particularly impressed when I came to pick them up in a Ford Granada.  But you know what?  It moved and so I have fond memories of the fact that it got me to where I needed to go.  That’s about all I can say about the Ford Granada. 

AAA: Thank you, Mr. President, on behalf of our 53 million members.

 

Hi Res Hi Res
Lo Res Lo Res

AAA Lists State-by-State Average Price per Gallon

(WASHINGTON, Feb. 21, 2012) The price of West Texas Intermediate (WTI) crude oil increased by $2.60 per barrel today to settle at $105.84 at the close of formal trading on the NYMEX, after markets were closed yesterday for the Presidents’ Day holiday. This is the highest settlement price since May 4, 2011. Crude prices today were driven higher by bullish news overseas, as European finance ministers yesterday agreed to a Greek bailout package and Iran halted its oil exports to France and Britain.

An improving economy overseas would be expected to consume more oil, which exerts upward pressure on prices. At the same time, when economies strengthen overseas, the U.S. dollar weakens and the price of oil (traded in dollars) becomes relatively less expensive. Oil futures subsequently become a more attractive investment, which exerts upward pressure on prices, as was the case today. While Iran’s announcement that it would cut off oil exports to Britain and France is worth noting, as it continues the recent escalation of geopolitical tension and uncertainty in the market, the ultimate impact on supply is limited. Britain and France get the majority of their oil from the North Sea region, and Iranian imports account for only 3 percent of their daily needs.

Despite continuing reports of historically anemic demand, crude prices last week were pressured higher by positive economic reports and increased tension with Iran. As Greece moved closer to securing the bailout necessary to prevent default on its sovereign debt, the U.S. economy continued to show signs of recovery, and WTI crude prices rose to end the week at a new 2012 high. At the same time, WTI continued to trade at a significant discount to Brent crude (the historic European benchmark) due to the bottleneck of WTI at its delivery location in Cushing, OK. With this in mind, many analysts have suggested that Brent may be a more accurate global benchmark for oil prices at this time. While refineries in the center of the country have access to these relatively cheaper crude products, refineries near the coast must purchase crude at more expensive global prices. This disparity is subsequently reflected in the price that motorists are paying at the pump, as those in the center of the country see relatively lower prices than those closer to the coast. Please see below for a state-by-state list of today’s average price for a gallon of regular gasoline.

Motorists in Hawaii and California are paying on average more than $4.00 per gallon, while those in Colorado and Wyoming pay less than $3.10. Drivers in Hilo, HI pay the highest price of any metropolitan area nationwide ($4.44 per gallon) however the ten highest priced areas in the lower 48 states are all in California and are all above $4.00 per gallon as well. These areas with the top-ten highest prices are listed below.

  1. Santa Barbara-Santa Maria-Lompac, CA: $4.105
  2. San Luis Obispo-Atascadero-Paso Robles, CA: $4.103
  3. San Diego, CA: $4.087
  4. LA-Long Beach, CA: $4.082
  5. San Francisco, CA: $4.079
  6. Ventura, CA: $4.077
  7. Orange County, CA: $4.071
  8. Riverside-San Bernardino, CA: $4.047
  9. (tie) Oakland, CA: $4.031 and San Jose, CA: $4.031

The current national retail average price for a gallon of self-serve regular gasoline is $3.57. Today’s price is six cents more expensive than one week ago, 18 cents more expensive than one month ago, and 40 cents more expensive than one year ago.

In US, ample oil supply continues while demand at multi-year low

Washington, Jan. 17, 2012 — The price of West Texas Intermediate (WTI) crude oil was up $2.01 to settle at $100.71 at today’s close of formal trading on the NYMEX.  As has been the case for much of the new year, today’s price increase can be attributed to global economic and geopolitical news stories.  Today’s stories included bullish news of decreased euro zone inflation for December — raising speculation that this might allow the European Central Bank to lower interest rates to boost that economy — and reports that Saudi Arabia was urging other Arab countries not to increase oil production in response to global economic sanctions on Iran. Both a strengthening global economy that would be expected to demand more crude oil and the threat of decreased global oil production puts upward pressure on crude prices.

Last week’s trading saw crude oil prices decline on bearish economic news in Europe, predictions that tensions with Iran would be unlikely to result in an impact to global supply, and continued dismal demand data.  WTI settled at $101.31 per barrel to begin the week and finished at $98.70 — a decline of $2.61.

The struggling European economy received another blow late last week when Standard and Poor’s downgraded the credit rating of the European Financial Stability Facility (EFSF) — created to fund rescue packages for euro zone countries facing sovereign debt crises — from AAA to AA+.  The EFSF credit rating is derived from the ratings of its sponsor countries, two of which (France and Austria) were downgraded last Thursday.  A downgraded credit rating means a higher interest rate must be paid to borrow money.

Reports last week that the European Union might delay planned sanctions on Iranian oil imports supported the assessment of many analysts that recent geopolitical tensions with Iran were likely to be limited to “saber-rattling” rather than an actual impact to the global oil supply. However, with Iranian naval exercises announced for January 27th in the Strait of Hormuz, the specter of a supply disruption remains and the associated uncertainty has kept some upward pressure on crude prices. Also contributing to this global supply uncertainty is the threat of continued labor strikes in Nigeria over the abolition of domestic fuel subsidies. Nigeria is Africa’s largest oil producer.

While geopolitical developments have dominated headlines, the implication of the bearish U.S. oil data in recent months cannot be ignored. Last Wednesday’s weekly Department of Energy report continued the trend of ample supply and dismal demand.  According to that report, crude demand for the first week of 2012 was 17.8 million barrels per day, 200,000 barrels per day less than the same week last year and only the sixth time since 2000 that demand has been below 18 million. Gasoline demand was reported at just over 8 million barrels per day, a 400,000-barrel-per-day year-over-year decline and the lowest level since early 2003.

Despite U.S demand for gasoline being at a multi-year low, high crude prices and reports of impending refinery shutdowns have seen the national average price at the pump increase ten cents to begin 2012. These scheduled refinery shutdowns come amid crumbling refining margins as global crude prices remain near multi-month highs and gasoline demand remains weak.  The current national retail average price for a gallon of self-serve regular gasoline is $3.38.  Today’s price is fractions of a penny cheaper than yesterday, but a penny more expensive than one week ago, 15 cents more expensive than one month ago, and 28 cents more expensive than one year ago.

As North America’s largest motoring and leisure travel organization, AAA provides more than 53 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.

Growing global economy is expected to demand more crude oil

WASHINGTON, Jan. 3, 2012 — On the first trading day of 2012, the price of West Texas Intermediate (WTI) crude oil rose $4.13 to settle at $102.96 at the close of formal trading on the NYMEX — the highest settlement price since May 10of last year. Today’s price increase was attributed to positive reports on the U.S. and Chinese economies and continued supply concerns surrounding increasing tension between Iran and the U.S. in the Persian Gulf. A growing global economy is expected to demand more crude oil, which pressures prices higher, as does the possibility of future disruptions to global supply.

In response to the ongoing development of Iran’s nuclear program in 2011, the U.S. and European Union (EU) announced economic sanctions against Iran. Under these initial sanctions, the Iranian currency (the rial) declined steeply placing designed economic pressure on the Iranian government.  As the U.S. and EU publically considered enacting further sanctions, Iran began conducting military exercises last month in the Strait of Hormuz, raising the intended specter of possible supply disruptions.  About one-third of all global seaborne oil passes through the narrow channel of water which sits between Iran and Oman.  Tensions have continued to rise as President Obama on Saturday signed a new round of sanctions into law, European leaders announced that they will consider a full embargo of Iranian oil later this month, and Iran yesterday continued a week of missile tests designed to demonstrate its defensive capabilities — the same day that the rial lost 10 percent of its value and Iran’s central bank called an emergency meeting to discuss the tumbling currency.  While most analysts have classified the action to date as “saber-rattling” and there has not been a disruption to Middle Eastern oil production or distribution, the possibility of a future impact to global supply has kept upward pressure on oil prices and will bear close attention in coming weeks.

2011 enters the books as a year of oil supply concerns in the Middle East and Northern Africa, an unprecedented price spread between WTI and Brent crude, bearish global economic news, and subsequent U.S. gasoline demand destruction.  Escalation of violence in Libya in February saw crude prices surge higher, with a peak WTI price of $113.93 on April 29 and a peak national retail average gas price of $3.98 on May 5.  During this time, the price difference or “spread” between the U.S. crude benchmark (WTI) and the European benchmark (Brent) widened to a record level as WTI products became backlogged at their delivery point in Cushing, OK, and became relatively insulated from the upward price pressure seen on other crude products on the global market.  The price spread peaked at nearly $30 to begin September but has closed to less than $10 as the WTI backlog has been alleviated.  Prior to 2011, a spread of even a few dollars would have been considered significant.  At the same time, high crude oil and gasoline prices, along with bearish signs for a struggling global economy and sovereign debt concerns, have weighed on markets.  Last Thursday’s Department of Energy report showed U.S. October gasoline demand at 8.623 million barrels per day — the lowest October number since 2000 and a more than four percent decline from the same month in 2010.  WTI crude oil began 2011 at $91.55 per barrel and ended the year at $98.83.  The national average gas price began 2011 at $3.07 per gallon and ended the year at $3.28.

On an annual average basis, U.S. motorists paid the all-time highest price for gasoline in 2011, surpassing the former all-time record set in 2008.

National Annual Average Price for Regular Gasoline

2001 – $1.44

2002 – $1.35

2003 – $1.56

2004 – $1.84

2005 – $2.27

2006 – $2.57

2007 – $2.79

2008 – $3.25

2009 – $2.34

2010 – $2.78

2011 – $3.51

The all-time highest recorded daily national average price of $4.11 occurred on July 17, 2008. However, the daily national average price declined to less than $2 per gallon by November 21 of that year and retreated to $1.62 per gallon by late-December as the U.S and global economies were mired in the worst recession since the 1930s. While the daily national average price reached its all-time high in July 2008, the price declined significantly — by almost $2.50 per gallon — by the end of the year.

As crude oil prices today rose to their highest level in months, the price of gasoline remains near the multi-month low of $3.21 registered on December 21. The current national retail average price for a gallon of self-serve regular gasoline is $3.28. Today’s price is a nickel more expensive than one week ago, fractions of a penny more expensive than one month ago and 21 cents more expensive than one year ago.

As North America’s largest motoring and leisure travel organization, AAA provides more than 53 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.

Iraqi crude production increases to highest levels in 20 years 

(ORLANDO, Fla., Dec. 27, 2011) – Oil futures were able to sustain modest gains during formal trading on the NYMEX before finishing at $101.34 at the close, an increase of $1.66.  Market watchers predict the short holiday week will yield lightly traded sessions through Friday. 

While continued weakness in the U.S. dollar is helping to sustain crude oil gains, the bigger factor appears to be positive economic news at home. Consumer confidence in the U.S. rose higher than expected in December and reached its highest level in eight months. The markets reflected a positive viewpoint that the U.S. economy, the world’s largest consumer of crude oil, is making steady improvements. This sentiment helped to keep West Texas Intermediate (WTI) crude above the $100 per barrel mark throughout today’s trading session.

While the economic news in the U.S. is encouraging, recent sectarian violence in Iraq is causing some analysts to raise the possibility that there may be long term impacts on Iraq’s ability to reach its crude production targets. After the complete withdrawal of U.S. troops last week, reports indicated that Iraqi crude oil production has increased to more than 3 million barrels per day and has reached its highest levels in 20 years. If the volatility and political turmoil inside Iraq continues it is likely to maintain upward pressure on crude prices as traders anticipate the possibility of a disruption in supply. 

Adding to further stress in the region, the Iranian Navy is conducting exercises in the Straits of Hormuz, an important strategic route that delivers oil to the U.S., Asia, and Western Europe. Iran is threatening activity that could disrupt commercial maritime interests in the area as a response to the possibility of economic sanctions being placed upon Iran’s oil exports. About one-third of all global oil passes through the narrow channel of water which sits between Iran and Oman. 

It is now all but certain that the ethanol tax credit of 45 cents per gallon of ethanol will end on Dec. 31, as Congress is apparently prepared to let it expire. With this development, most analysts are anticipating a slight bump in retail prices. The cost of ethanol that is blended into gasoline will increase and with that comes the expectation this could account for a few cents of upward pressure on gas prices. Currently, regular gasoline of up to ten percent ethanol (E10) can be found at pumps in addition to the flex-fuel vehicles that use up to 85 percent ethanol (E85). The expiration of the current tax credit will result in an increase of about four cents in the price of a gallon of E10 gasoline and about 40 cents in the price of a gallon of E85.  

The national average price for a gallon of regular unleaded gasoline was $3.23, the same price as yesterday but two cents higher than last week. This price is seven cents cheaper than last month but 19 cents higher than last year. Utah, New Mexico and Missouri are the only states currently paying less than $3 per gallon. Hawaii is the only state paying higher than $4 per gallon. 

 As North America’s largest motoring and leisure travel organization, AAA provides more than 52 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.

Weaker U.S. Dollar Pressures Oil Price Upward

December 20th, 2011 by admin

Consumers enjoying lower prices at pump as substantial demand destruction continues to weigh on the market

(ORLANDO – Dec. 19, 2011) After tumbling for a second straight week, the price of West Texas Intermediate (WTI) crude oil began this week up 35 cents to settle $93.88 at the close of today’s formal trading on the NYMEX. Today’s slight price increase was attributed to a weaker U.S. dollar following a statement this morning that the European Central Bank has “no doubt” in the strength of the euro. This statement reversed what had been initial strength in the dollar today after news that the European finance ministers would request funding from the International Monetary Fund (IMF), a decision that was at first evaluated as bearish for the euro. Oil futures are priced in U.S. dollars.  As the dollar weakens relative to currencies abroad the effective purchasing power of those holding foreign currencies increases. As this happens, oil futures become a more attractive investment, which exerts upward pressure on prices. Today marks the start of what is traditionally a light volume two-week trading period to end the year.

Reports of an Iranian military drill and rumors of a third round of quantitative easing by the Federal Reserve provided some temporary upward pressure on crude oil prices early last week, as prices rose back above the $100 per barrel settlement price at Tuesday’s close.  The former news injected uncertainty into the future global supply of crude oil, while the latter suggested that the U.S. might again be preparing to jumpstart its struggling economy.  Both stories ultimately were proved false, and the markets quickly returned their focus to the broad global economic concerns and dismal U.S. oil demand that have been the central stories in recent months. 

Rising concerns of a recession in Europe were highlighted by a Wednesday report that nearly half of money managers fear a partial breakup of the euro zone.  This looming concern for the very foundation of the euro sent the value of that currency tumbling and, subsequently, the value of the U.S. dollar soaring.  This downward pressure on crude prices was amplified by a Department of Energy report the same day that, while crude inventories had dropped on the week, gasoline inventories had built substantially as demand continues to be dismal.  While gasoline demand is historically nine million or more barrels per day at this time of year, last week’s report showed a demand of just 8.6 million barrels.  WTI crude prices fell by $5.19 per barrel on Wednesday — the largest one day decline since mid-August — and ended the week at $93.53.  The overall decline on the week was $4.24 per barrel, the largest weekly decline in 12 weeks.

As crude oil prices dropped last week, the price of gasoline at the pump continued to decline and is now at the lowest point since February 23. This is largely due to the substantial demand destruction that continues to weigh on the market. The most recent gasoline demand report shows the four-week average at 4.5 percent lower than the same period in 2010. The current national retail average price for a gallon of self-serve regular gasoline is $3.22. Today’s price is a nickel less than one week ago and 15 cents less than one month ago. While today’s price is 24 cents more expensive than one year ago, it is the lowest year-over-year premium since June 1, 2010, when American drivers were paying $2.73 per gallon. Earlier this year, motorists often paid more than a 90-cent year-over-year premium.

Drivers in five states are currently paying less than 20 cents more at the pump than one year ago: New Mexico (14 cents), Delaware (15.6.cents), New Jersey (18.7 cents), Ohio (19.4 cents) and Maryland (19.8 cents).  Drivers in four states are currently paying more than a 40-cent year-over-year premium: Colorado (40.2 cents), Wyoming (40.3 cents), Alaska (40.7 cents) and Hawaii (42.8 cents).

 As North America’s largest motoring and leisure travel organization, AAA provides more than 52 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.

ORLANDO, Fla., March 11, 2009

Troy GreenAAA, the nation’s largest organization for motorists and leisure travelers, today launched a new version of its fuel price reporting web site – the AAA Fuel Gauge Report – located at www.aaa.com/fuelgaugereport . The site, which relies on data collected for AAA by Oil Price Information Service (www.opisnet.com), is presented as a public service by AAA.

In addition to displaying the daily average price for all major grades of retail gasoline, diesel and E-85 for the nation, all fifty states and more than 300 metro locations, the site now features a weekly commentary on prices from AAA, an expanded graph showing price trends for oil, wholesale gasoline and retail gasoline, and price comparisons for today, yesterday, one week ago and one year ago. A color-coded “heat” map has been added illustrating average price differences among the fifty states. New links to other fuel and travel-related information sources are available and the site continues to provide access to the only daily fuel price reporting in the Spanish language.

Fuel price reporting is a form of consumer advocacy

AAA first began reporting on fuel prices in the mid-1970s during the gasoline crisis of that era. The printed news releases that AAA clubs mailed to reporters were dubbed the AAA Fuel Gauge Report, and have continued in one form or another for more than 30 years.

AAA’s long-time fuel price analyst and director of Public Relations, Geoff Sundstrom, said the association’s Fuel Gauge Report has allowed AAA to shine a steady spotlight on the topics of fuel affordability, energy conservation and the need for a far-sighted national energy policy. “By publishing the average cost of fuel each day on the Internet throughout most of this decade, AAA has played a major role in stimulating the ongoing national debate on this very important topic,” he said.

Unmatched database delivers price reliability

The AAA Fuel Gauge Report web site is heavily sourced by media due to its unmatched statistical reliability and the ability of AAA’s national and local spokespeople to comment in an informed and unbiased manner on what the data means for motorists. OPIS derives the data from credit card transactions at more than 100,000 gasoline stations and updates the site for AAA each day. No other fuel price research tool has such a large, automatically generated database that is especially useful in generating local average prices which are more meaningful for consumers. Last year the site was visited more than 30 million times.

AAA’s vendor partner in this endeavor, Oil Price Information Service, has enhanced its already considerable reputation for data accuracy and analysis through its work on the project. Fred Rozell, director of retail pricing at OPIS said, “Our company has been proud to partner with AAA in bringing retail fuel price transparency to the media for the past 10 years. We are really excited by the revamped look which not only highlights the hotspots with a quick glance, but also retains the classic ease of use to which users have become so accustomed.”

As North America’s largest motoring and leisure travel organization, AAA provides more than 51 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.

ORLANDO, Fla. – September 27, 2007

BTU-adjusted price of E-85 also displayed to help consumers gauge the cost of the lower-mileage fuel compared to gasoline  

Troy GreenHighlighting the growing availability and interest in the use of E-85 fuel as an alternative to conventional gasoline, the nation’s largest organization for motorists has begun publishing the nationwide average price of the mostly-ethanol blend of fuel this week on its widely-quoted AAA Fuel Gauge Report Web site (www.aaafuelgaugereport.com).

Pricing information for E-85 is also available on AAA’s TripTik® Travel Planner, an interactive mapping, routing and travel planning tool that is available free at AAA.com.

E-85 is the common name for a motor fuel made from a blend of approximately 85 percent ethanol and 15 percent gasoline. Conventional gasoline frequently contains as much as 10 percent ethanol, but much higher concentrations require special modifications to vehicle fuel systems and engines.

According to AAA, today’s nationwide average price of self-serve regular gasoline is $2.811 per gallon compared to $2.334 for a gallon of E-85.

“The addition of a national average E-85 price to AAA’s fuel price research Web site signals the arrival of ethanol as an increasingly competitive alternative to conventional gasoline in some areas of the nation,” said the association’s chief fuel-price commentator, Geoff Sundstrom.

There are approximately 4.5 million motor vehicles now on American roads capable of operating on E-85 or conventional gasoline through the use of flexible fuel technology, and more than 1,200 gasoline stations nationwide are now dispensing E-85 on a regular basis. Most of these stations are concentrated in the upper Midwest near the nation’s ethanol processing plants, but E-85 pumps are beginning to appear in other regions as well.

“The number of vehicles that can burn E-85 coupled with the number of stations that can dispense it means more motorists should be actively considering the purchase or lease of a vehicle capable of operating on a mostly-ethanol blend of fuel. It is AAA’s belief that given higher oil prices in the future, E-85 will become even more competitively-priced as the ethanol industry continues to develop in the United States and around the world,” he said.

To help motorists understand the cost differential between E-85 and conventional gasoline, AAA also is posting a nationwide, average “BTU-adjusted E-85 price” that accounts for the fact that E-85 delivers approximately 25 percent less energy content per gallon than gasoline. BTU stands for British Thermal Units; a method of quantifying the available energy in any given fuel source.

Today’s BTU-adjusted price of E-85 is $3.071 per gallon, or 26 cents more expensive per gallon to get mileage equivalent to that contained in a gallon of self-serve regular, AAA said.

“Simply comparing the retail cost of a gallon of E-85 to a gallon of gasoline does not convey the inherent loss in fuel economy – and increase in vehicle operating expense – that accompanies the use of E-85,” Sundstrom said. AAA’s “BTU-adjusted E-85 price is intended to compensate for this situation and provide an apples-to-apples price comparison that is more helpful to consumers.”

Pricing information for alternative fuels, Bio-Diesel and E85, is also available on AAA’s TripTik® Travel Planner. The AAA TripTik Travel Planner is an interactive mapping, routing and travel planning tool that is available free at AAA.com. Users can search for gas stations in their area or along their route by selecting the gas icon. Once stations are listed, users can scroll over locations and pricing information for all available fuels at a particular station will appear in a pop-up window.

AAA’s TripTik Travel Planner includes detailed maps, turn-by-turn directions, AAA proprietary content (such as scenic roads, congested areas, and construction information), AAA/CAA club locations, TourBook® and CampBook® guide information (including Diamond ratings for hotels and restaurants) and online hotel booking functionality. Users can map a single location or create complete point-to-point itineraries using specific addresses or populated drop-down lists that include airports, colleges and universities, major sports venues, hospitals, golf courses, ski resorts, cruise ports and national, state and provincial parks.

The data collection and calculations used to derive the prices of gasoline, E-85 and the “BTU-adjusted” price of E-85 is performed for AAA by Oil Price Information Service, the nation’s most comprehensive source of petroleum pricing information, as a public and member service. AAA’s national and club public affairs departments independently analyze and comment on fuel price patterns and trends based on its more than 30 years of ongoing fuel price consumer advocacy.

The AAA Fuel Gauge Report Web site lists average daily prices for the nation, all 50 states and more than 250 localities for all grades of gasoline, making the site the most current and comprehensive public source of fuel price information.

As North America’s largest motoring and leisure travel organization, AAA provides its more than 50 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.

ORLANDO, Fla. , May 23, 2007

With soaring gas prices squeezing many household budgets, AAA is helping consumers with tips on how to save gas, Web sites dedicated to fuel information and a gas rebate credit card. 

Troy GreenWhen fuel prices rise to new record levels, motorists have an understandable interest in finding out why, and need information on what they can do to stay within the family budget, according to AAA.

To help consumers make better decisions regarding their fuel consumption AAA began posting localized, up-to-date fuel information on the Internet in 2000, and now has two Web sites devoted to fuel issues as well as other online tools for consumers.

Perhaps the best known site is AAA’s Daily Fuel Gauge Report. That site – a natural extension of the reports AAA has issued in some form since the 1970s – averages prices paid at 100,000 gas stations across the country and posts national, state and local averages daily for each of the major grades of gasoline.

AAA Fuel Cost Calculator helps users understand and budget for the amount of fuel they are likely to use on a long-distance trip. After entering the trip’s origin and destination, and the type of vehicle being driven, the site calculates the miles driven, the amount of fuel that will be used and the cost. It also can tell motorists the difference in fuel costs for various vehicles, helping them to determine which vehicle is most cost effective to drive.

Earlier this year, AAA enhanced its online trip planning tool, TripTik® Travel Planner found at www.AAA.com, with location and fuel pricing information for more than 100,000 U.S. gas stations. Using the planner, travelers can note the locations of convenient fuel stops along their vacation driving route.

To help counteract the effect of high gas prices on family budgets, the AAA Visa® credit card offers a rebate of up to 5 percent on gasoline purchases made at the pump. The more cardholders use their card for everyday, non-gas purchases, the greater the rebate will be for gas purchases. Since its inception in 2003, cardholders have saved $142 million on gas purchases.

AAA provides fuel-saving tips and advice to consumers through many local AAA club Web sites (www.AAA.com) as well as on its AAA Exchange site (www.AAA.com/publicaffairs) which includes fuel conservation information in a downloadable brochure titled, “AAA Gas Watcher’s Guide.”

Some tips from the guide include:

  • Stick to a routine maintenance schedule. Keeping tires inflated, moving components properly lubricated and ignition and emission systems operating properly will help ensure maximum fuel efficiency and extend the life of your vehicle.
  • If you own more than one vehicle, use the more energy-conserving vehicle as often as possible.
  • Consolidate trips and errands to cut down on driving time and miles traveled. When possible, combine them with your daily commute.
  • If you are going somewhere new, get a map first from an online source such as AAA TripTik (www.AAA.com). Getting lost wastes gas as well as time.
  • Comparison shop by phone or online if possible before heading out on the road.
  • Slow down. For most vehicles, fuel economy drops off significantly when traveling more than 60 miles per hour. As a rule of thumb, you can assume that each 5 mph you drive over 60 mph is like paying an additional $0.20 per gallon for gas.
  • Avoid quick starts and sudden stops. They waste fuel, are harder on vehicle components and increase the odds of a traffic crash.
  • Lighten your vehicle by cleaning out the trunk, cargo areas and passenger compartments. A heavier vehicle uses more fuel.
  • Keep your eyes open for low fuel prices but don’t waste gas driving to a distant filling station to save a few cents.

AAA Fuel Gauge Report and AAA Fuel Cost Calculator are based on data from Oil Price Information Service, the nation’s most comprehensive source of petroleum pricing information.

As North America’s largest motoring and leisure travel organization, AAA provides more than 50 million members with travel, insurance

WASHINGTON, D.C. – May 15, 2007

“Short-Term Energy Outlook Summer 2007: Oil and Gasoline”  

Troy GreenAAA appreciates your invitation to appear before the Energy and Natural Resources Committee to discuss the short-term future of oil and gasoline prices. AAA’s concern revolves around the impact rising prices have on consumers.

As you may know, AAA is the largest paid-membership organization in North America. Earlier this year we were fortunate enough to have achieved the milestone of having 50 million members in the United States and Canada. Our members drive approximately 25 percent of all the motor vehicles in operation in this country. Using figures from the U.S. Department of Transportation, we estimate they will purchase approximately 33 billion gallons of gasoline this year and at current prices will spend about $100 billion on gasoline.

The important question is: With prices having risen more than 70 cents a gallon this year, are Americans driving less? The fact is that consumers at different income levels are affected differently by higher prices. There are affluent people in America for whom spending an additional $100 per month on gas is not an issue. Some people have other transportation options and flexibility and can reduce their consumption of higher-priced fuel. But the vast majority of Americans have no choice but to absorb the extra $50, $100, or $150 a month in gas prices. They have to go to work, take children to daycare, and go to the grocery. This is not discretionary travel that can be limited.

Like it or not, gasoline is a significant part of many Americans’ budgets. When gas prices increase, there is less money to spend on other things. The extra expense results in a sacrifice elsewhere in a family’s budget – groceries, healthcare, college savings, retirement planning.

Part of what we do at AAA is help motorists understand what they can do to reduce the burden of high gas prices, from vehicle maintenance to trip-chaining, to purchasing more efficient vehicles, there are things that Americans can do to mitigate the impacts of high fuel prices. We also work to help motorists understand what is going on in the fuel markets, and in times of crises, like after the hurricanes of 2005, to help them understand how their decisions can impact what happens in the market.

Unlike others that frequently comment on gasoline pricing, AAA has no involvement in the regulation, refining, shipping, blending or sale of gasoline. We do not trade oil and gasoline futures, operate hedge funds, sell mutual funds, distribute investment newsletters or make commissions on the sale of energy stocks.

AAA has increasingly found itself involved in the great national debate on America’s energy future and has been able to fill an important niche in objectively monitoring the price of fuel, advising consumers about fuel conservation and, to a limited degree, helping motorists anticipate what they might expect to pay to fuel their personal vehicles in coming months and years.

Because America’s energy challenges are increasing rather than moving toward a workable solution, AAA intends to engage in the public policy debate to a greater extent and to play a greater role in helping the public understand the choices and consequences of pursuing – or not pursuing — specific courses of action.

This week American consumers are experiencing the highest average prices they have ever paid for gasoline. They know this because on Mother’s Day Sunday, May 13, AAA’s daily, online Fuel Gauge Report Web site recorded a highest-ever nationwide average price for self-serve regular gasoline of $3.073 per gallon.

We have crossed the $3 per gallon threshold twice before. Prices topped out at $3.036 per gallon on August 7 of last year, after Israel invaded Lebanon. That price nearly reached the then-record average price of $3.057 per gallon paid by Americans on Labor Day Monday of 2005, after Hurricane Katrina temporarily closed or damaged critical oil and gasoline infrastructure along much of the Gulf Coast.

As frustrating and unpleasant as our two previous national experiences with $3 gasoline have been, both were accompanied by an oil price at or exceeding $75 per barrel and a natural or man-made disaster with the real or perceived ability to block the flow of petroleum for some period of time.

This summer is clearly different, however. This year, $75 oil prices and dramatic news about hurricane damage or a possible war throughout the Middle East are absent. Instead, we have sky-high gasoline prices as the cost of oil rests comfortably near the $60 per barrel target set by OPEC, amidst crude inventories that are routinely described as plentiful. Without OPEC, Mother Nature, or an imminent man-made catastrophe to blame for the high price of gasoline, Americans want to know, “why?”

I am certainly not appearing before this committee today to say that AAA has the answer. But as near as we can tell, there are strong indications the problem lies at least in part with the fact that the domestic refineries that supply gasoline to America’s network of filling stations, as well as the companies that import gasoline from abroad for sale here, have been slow to supply the wholesale distribution network as consumer demand for their product has continued to rise.

AAA leaves it to the experts at the U.S. Department of Energy to cite the specific numbers behind this situation. But we are concerned about the number and frequency of refinery outages this year in light of the large profits the industry has been reporting quarter after quarter for most of this decade.

In fact, the very idea that America should be losing ground in its ability to supply enough gasoline to our economy – not oil, which this committee knows is a different problem – is troubling. It is troubling because the oil refining business has for several years been described by the international financial community as enjoying a “renaissance” of profitability and because they – and scores of our public and private institutions – employ armies of economists and statisticians to forecast the rates at which economies grow, populations expand, motor vehicles are produced and energy consumption increases.

With all of these numbers being collected, exchanged over the Internet and run through computers, Americans should be able to expect that those who refine oil into gasoline do a better job of anticipating demand growth, plan to meet that growth, and then make the necessary investments in plants, equipment and labor to provide the fuel at a cost that has some semblance of stability. AAA doesn’t know the answer, but we do think it would be worth the Committee’s time and trouble to find out.

With these thoughts as a background for our discussion on short-term gasoline prices, AAA would first like to say that no one can know with certainty the price of gasoline this summer. For example, it was our belief the national average price of self-serve regular would not exceed $3 per gallon this Spring, but this was before anyone knew gasoline inventories would drop for 12 consecutive weeks as refiners continued to report equipment problems. Instead, what AAA tries to do is identify and describe a trend that points to top or bottom for fuel pricing. We do this to help consumers anticipate what their monthly fuel expenses will be.

With that said, let’s look at what we know right now: We know that gasoline inventories are critically low especially on the West Coast; our refining and distribution infrastructure are stressed due to maintenance/investment issues, but also due to the introduction of ethanol into the blending process and our boutique fuel requirements; increased imports of gasoline, which have been growing, are hoped for but not assured; hurricane season is on the way; and much of the world’s oil production shipping still takes place in a dangerous part of the world.

We also know the stock market has just had a record run, demand for gasoline remains strong, and the summer travel season – which is important to our quality of life and crucial to the financial success of tens of thousands of tourism-related business across this country – is around the corner.

Knowing these things, and using our experience watching gasoline prices, the wholesale and retail gasoline prices generated for AAA by Oil Price Information Service, and the production, inventory and import numbers produced by DOE, AAA thinks prices are likely to move somewhat higher over the next 60 days, perhaps approaching $3.25 per gallon. But the much- ballyhooed $4 per gallon gasoline will not materialize as a national average price unless the oil price marches into the $75 per barrel or higher range – a scenario that is only likely if an unknowable event such as a hurricane or geo-political conflict were to seriously threaten or disrupt energy flows. In making the projection to media that a $4 per gallon average gasoline price was not probable, AAA has been described in the last few weeks by some analysts as “conservative” and “not wanting to panic” consumers. In fact, our views simply reflect our interpretation of the best available data and analysis.

In closing, AAA would like to address the notion that if the price of gasoline goes high enough Americans will significantly reduce their gasoline consumption and help solve our energy problem. Again, AAA does not believe that Americans are frivolously driving around wasting either gasoline or money. According to AAA’s most recent study of driving expenses, it costs 52.2 cents per mile to own and operate a typical new vehicle in the United States. That’s $52.20 to drive 100 miles — and this number was calculated using an average fuel price from the fourth quarter of last year of just $2.26 per gallon.

What we have seen based on many years of watching Americans’ driving habits is that motorists reduce their discretionary driving only based on a significant slowdown in the economy and the possibility of job loss, or in response to gasoline shortages. While no one wants to pay high gasoline prices – and those prices do not inflict pain equally since those at the lower end of the economic scale are disproportionately burdened by rising prices – much of our driving is essential and is not easily traded for other modes of transportation. Instead, we think rising gasoline prices are a tax hike on the overall economy in which overall consumer spending is cut to pay for a commodity that has become, in many ways, as essential as food and shelter.

Whether the result of geopolitical, refining, or distribution factors, the fluctuations in fuel prices underscore the nation’s vulnerability and the need to take a broad approach to securing a more diverse and sustainable supply of energy into the future. AAA acknowledges that fossil fuels will play a critical role in our nation’s economy for the foreseeable future, but we strongly believe steps must be taken to decrease our reliance on oil and refined gasoline to ensure the strength of our economy, the security of the nation, and our way of life.

Thank you again, Mr. Chairman, for allowing AAA to address this Committee on this critically important topic.

Geoff Sundstrom – Director, Public Affairs

Geoff Sundstrom is Director, AAA Public Affairs and is based at AAA’s National Office in Heathrow, Florida. He is a widely-quoted source on a variety of automotive and travel topics, and is AAA’s leading spokesperson on energy issues, including gasoline prices. He has managed AAA’s well-known Fuel Gauge Report gasoline price survey since the late 1980′s, including its migration from a paper-based product to the Internet in 2000. He is the author of AAA’s Gas Watcher’s Guide, a free brochure that helps consumers conserve fuel. Geoff is interviewed on a regular basis by national financial and consumer media, and advises local AAA clubs on media relations. He is at the forefront of AAA’s efforts to respond to gasoline price spikes or reports of fuel outages. Geoff joined AAA in 1989 after working for eight years as a business journalist in Washington, D.C. for Automotive News magazine, the New York Journal of Commerce and Kyoto News Service. Geoff holds a journalism degree from Northern Arizona University in Flagstaff.

Podcasts

B-Roll

YouTube Videos

AAA Senior Driver Expos

NewsRoom Video Gallery

Media: Find and Download AAA Videos and B Roll.