Gas Prices: AAA’s Fuel Gauge Report | November 19, 2012

(WASHINGTON, November 19, 2012) Today’s national average price for a gallon of regular unleaded gasoline is $3.42.  This price is two cents less expensive than one week ago and 28 cents less expensive than one month ago, however it is still five cents more expensive that one year ago and the highest price on record for this calendar day.  Today’s price continues the streak of daily record prices that began on August 20.

To begin last week, motorists in some of the areas hit hardest by Hurricane Sandy still faced long lines at the pump due to lingering regional fuel distribution issues in the aftermath of the storm.  In response to these lines, northern New Jersey, New York City and Long Island each imposed odd-even gasoline rationing policies.  As distribution has returned to normal and lines have dwindled, New Jersey ended rationing rules last Tuesday, after ten days, and Long Island lifted the restriction last Friday at midnight, after eight days.  Rationing in New York City was scheduled to end today but has been extended through Friday citing the Thanksgiving travel week.

Both long lines at the pump and gasoline rationing policies have drawn comparisons to those seen in the 1970s.  The circumstances, however, are very different.  While the recent situation was due to a temporary and regional disruption to distribution, the situation in the 1970s was due to a prolonged and nationwide supply shortage.

While pump prices in New York and New Jersey did increase following the hurricane, prices have just as quickly returned lower as power and distribution issues have been resolved.  Prices in Long Island are 16 cents lower than one week ago, prices in New York City are 11 cents lower and prices in New Jersey are eight cents lower.

Nationally, the retail price of gas has been falling steadily since mid-September.  Motorists in every state are paying less at the pump than they were one month ago, with the sole exception being drivers in Ohio. Consumers in the Buckeye State are paying one-tenth of a penny more than a month ago but still 36 cents less than in September.  Motorists in Hawaii ($4.11) and Alaska ($3.97) pay the most for a gallon of gasoline, while those in Missouri ($3.08) and South Carolina ($3.12) pay the least.

AAA expects that gas prices across the country will continue to decline approaching the end of the year, barring any major market moving news, as lower demand, cheaper winter-blend gasoline and economic concerns continue to pressure pump prices lower.

Two such potential market moving news items have been front and center over the last week: escalating violence between Israel and Palestine and the looming U.S. “fiscal cliff.”  While neither Israel nor Palestine is a major oil producer, increased geopolitical uncertainty in the Middle East puts upward pressure on prices, as do signs in Washington of progress working to address economic concerns.  Oil prices last week remained flat, however developments with both stories prompted bullish market sentiment and sent prices sharply higher today.  At the close of today’s formal trading on the NYMEX, West Texas Intermediate (WTI) crude oil was up $2.36 on the day to settle at $89.28 per barrel — the highest settlement price since this day last month.

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