AAA Monthly Gas Price Report: August 2013 Trends and September Outlook

Michael Green

(WASHINGTON, September 4, 2013)

 

 

 

 

Summer Driving Season was Third Most Expensive on Record

  • Motorists this year paid the third most expensive gas prices on record during the busy summer driving season, which is Memorial Day through Labor Day. Motorists paid an average of $3.58 per gallon this summer, compared to $3.95 in 2008, $3.65 in 2011 and $3.55 in 2012.
  • The national average price of gasoline declined about three cents per gallon (one percent) in August. The average price of gas in August was $3.57 per gallon, which was the fourth-highest average on record for the month. By comparison, the average was $3.77 per gallon in 2008, $3.69 per gallon in 2012 and $3.62 per gallon in 2011.
  • “Motorists paid significantly lower gas prices than recent years in August as most refineries ran smoothly and no hurricanes threatened production,” said Avery Ash, AAA spokesman. “There are more than sufficient gasoline supplies for current demand, which has kept prices somewhat stable despite concerns about violence in the Middle East.”
  • Gasoline supplies are about eight percent higher than a year ago due to relatively smooth refinery operations and a very weak Atlantic hurricane season thus far. This is the first time in 11 years that a hurricane has not formed in the Atlantic by the end of August. Average gas prices in August 2012 increased 33 cents per gallon due to significant refinery problems and Hurricane Isaac.
  • The price of West Texas Intermediate crude oil reached $110.10 per barrel on Aug. 28, the highest closing price since May 2011 on market concerns about a possible U.S. strike in Syria, in addition to continued violence in Egypt and Libya. WTI crude oil has remained above $100 per barrel since July 3, the same day the military took control in Egypt. By comparison, WTI closed at $96.47 to end the month in 2012.

Gas Price Prediction for September Uncertain due to Potential Risks

  • “Gasoline prices usually drop with the end of the summer driving season, but it is impossible to say whether this will be a typical year given the potential risks facing the market,” continued Ash. “Escalating tensions in the Middle East and North Africa, possible U.S. action in Syria or a major hurricane could make it more expensive to buy gas, while a relatively calm month should send prices much lower. It is too soon to know how these factors might affect motorists in the coming weeks.”
  • Gas prices have declined four out of the previous five years in September for an average of eight cents per gallon due to lower demand and the switchover to less expensive winter-blend gasoline. Gas prices in September 2012 decreased about five cents per gallon.
  • The statistical peak for the Atlantic hurricane season is Sept. 10, and the National Oceanic and Atmospheric Administration has forecast a more active than average season.
  • The switchover to less-expensive winter-bend gasoline will begin on Sept. 15. Regional prices occasionally rise in the few days leading up to the switchover as supplies of summer-blend gasoline decline before the deadline. Gas stations are required to sell more expensive summer-blend gasoline to meet air-quality regulations.

Gas Prices Nearly Twenty-Five Cents Less Expensive than a Year Ago

  • Today’s national average price of regular gasoline is $3.59 per gallon, which is 24 cents less than a year ago. Today’s average is the fourth highest on record for September 3.
  • Only one percent of U.S. stations are selling gas for more than $4.00 per gallon, which compares to a year ago when 16 percent of stations were selling gas for more than that price. Thirty-seven percent of U.S. stations are selling gas for less than $3.50 per gallon, which compares to only two percent of stations selling gas for less than that price a year ago.
  • No state in the continental U.S. is paying an average of $4.00 per gallon or higher for gasoline. A year ago seven states in the continental U.S were paying an average of more than $4.00 per gallon including: Calif. ($4.16), Conn. ($4.03), Ill. ($4.13), Mich. ($4.05), N.Y. ($4.01), Ore. ($4.02) and Wash. ($4.05).
  • The five states with the highest average prices include: Hawaii ($4.31), Alaska ($4.02), Conn. ($3.94), N.Y. ($3.87) and Calif. ($3.83). The five states with the lowest average prices include: S.C. ($3.28), Miss. ($3.36), Ala. ($3.37), Ariz. ($3.38) and Va. ($3.38).

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, trjohnson@national.aaa.com.

 

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