Posts Tagged ‘quarterly gas report’

2018 AAA Gas Watchers Guide Provides Tips to Conserve Fuel and Save Motorists Money

WASHINGTON (August 29, 2018) – AAA forecasts that the national gas price average will drop to $2.70 this fall and has the potential to drop even more. That is 14-cents less a gallon compared to today’s price and more than a quarter cheaper than this year’s recorded high of $2.97 set in May.

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“Cheaper-to-produce gasoline and relatively stable crude oil prices in August, combined with an anticipated drop in consumer gasoline demand post-Labor Day, means consumers will see savings when they fill-up at the pump this fall,” said Jeanette Casselano, AAA spokesperson. “However, several outliers can reverse this forecast, including crude oil prices, geopolitical tensions and the mere threat of a hurricane.”

2018 gas prices have been significantly more expensive than 2017. In fact, the year-to-date-national gas price average ($2.73) is 41-cents more. Trends for year-over-year state averages include:

  • The top 10 states with the largest year-over-year difference in gas price averages are mostly West Coast, Northeast or Mid-Atlantic states: California (+57 cents), Hawaii (+54 cents), Indiana (+49 cents), Arizona (+48 cents), Oregon (+46 cents), Connecticut (+45 cents), Rhode Island (+45 cents), Utah (+45 cents) and Massachusetts (+44 cents).
  • Four Great Lakes and Central and one Southern state carry the smallest year-over-year difference in gas prices: South Dakota (+37 cents), Missouri (+37 cents), Louisiana (+36 cents), Iowa (+36 cents) and Nebraska (+35 cents).

What will drive pump prices down this fall?

Part of the anticipated drop in fall pump prices is due to the switchover to winter-blend gasoline in mid-September. The difference between summer- and winter-blend gasolines involves the Reid Vapor Pressure (RVP) of the fuel. RVP is a measure of how easily the fuel evaporates at a given temperature. The more volatile a gasoline (higher RVP), the easier it evaporates. Winter-blend fuel, which is cheaper to produce, has a higher RVP because the fuel must be able to evaporate at low temperatures for the engine to operate properly, especially when the engine is cold.

In addition, the arrival of fall historically means a drop in consumer gasoline demand as summer road trips and vacations subside. 

What could prevent cheaper gas prices from coming to a pump near you?

  • Crude Market Volatility: Much of 2018 has brought volatility to the domestic and global crude markets, as market watchers try to glean insight into forces that will shape global supply this fall. These forces include:
    • Venezuela is a major crude producer for the Western Hemisphere, but its collapsing economy could halt its crude production.
    • Organization of Petroleum Exporting Countries (OPEC) announced an increase in production over the summer, but slower-than-expected production growth could contribute to higher crude prices during the second half of the year.
    • Geopolitical uncertainty in the Middle East and around the globe could disrupt vital crude flows.
  • Iran Sanctions: When President Trump announced that the U.S. would withdraw from the Iran Nuclear Deal in May, the decision sent the crude markets into upheaval. In August, the first round of re-imposed sanctions on the country, which target Iran’s financial sector, went into effect and led to a brief uptick in crude prices. The next round of sanctions, currently scheduled to take effect in November, will target Iran’s energy sector – including its crude exports – and will likely have a more sustained impact on crude prices. If and when those sanctions take effect, crude prices will likely surge over an expected reduction in Iranian crude exports and increased tension in the region that could destabilize global crude flows.
  • Updated Hurricane Forecast: The National Oceanic and Atmospheric Administration’s Climate Prediction Center predicts a total of 9–13 named storms (winds of 39 mph or greater of which 4-7 will become hurricanes) including up to two major hurricanes (winds of 111 mph or greater). An average six-month hurricane season produces 12 named storms, of which six becomes hurricanes, including three major hurricanes. The mere threat of a hurricane in the U.S. would cause pump prices to spike, likely regionally, due to constrained supply and delivery challenges.

 

AAA 2018 Gas Watcher’s Guide

In time for fall, AAA is releasing the 2018 Gas Watcher’s Guide with tips for conserving fuel, saving money and maintaining fuel efficiency. The Guide offers these tips – and many more – for motorists to keep in mind as they fill-up at the pump:

  • If your vehicle’s engine does not require premium or mid-grade fuel, don’t buy it. Using anything other than regular grade is simply a waste of money.
  • Don’t top off your gas tank. Stop filling after the automatic nozzle shuts off the second time.
  • If you have to replace a gas cap, make sure it is the right one for your car. An ill-fitting cap will increase emissions and trigger the “check engine” light.
  • Keep track of gas mileage. If you notice a sudden decrease in fuel economy, have your vehicle checked by a technician to ensure it is operating properly.

Motorists can find current gas prices at GasPrices.AAA.com and 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.

Gas Prices Trend Cheaper, but Increases are Likely Looming

June 18th, 2018 by AAA Public Affairs

On the week, the national gas price average is two cents cheaper at $2.90. Today’s national average is only one cent more expensive than a month ago, but 60 cents more expensive than a year ago.

Nationwide, 44 states have less expensive or steady gas price averages compared to last Monday. However, the cheaper trend may be reversing. Gasoline demand spiked in the latest Energy Information Administration’s (EIA) report, in fact setting a new all-time record at 9.88 million b/d for the week ending June 8. As demand skyrockets, U.S. gasoline inventories plummeted 2.27 million bbl, to land total inventories at 237 million bbl, which is 5.7 million below stocks last year at this time.

“If demand continues to strengthen and inventories decrease in the weeks ahead, motorists can expect gas prices do a reversal and start to increase again,” said Jeanette Casselano, AAA gas price expert. “AAA expects the national gas price average to range between $2.85 and $3.05 through Labor Day, likely seeing the summer’s highest prices in June.”

Moving into this week, another factor that will influence gas prices in the near and long-term will be outcomes from the June 22 OPEC meeting in Vienna, Austria. The cartel, along with other major producers including Russia, will discuss increasing oil production ahead of the year-end scheduled dissolution of its production reduction agreement. Some reports indicate that OPEC could be looking at an increase of 300,000 to 600,000 b/d to help ease global crude price gains that have grown since the cartel put its production reduction agreement into place at the beginning of 2017. An increase in production would likely decrease crude oil prices and encourage cheaper gas prices.

Quick Stats

  • The nation’s top 10 most expensive markets are: Hawaii ($3.73), California ($3.71), Washington ($3.45), Alaska ($3.43), Oregon ($3.32), Nevada ($3.31), Utah ($3.19), Idaho ($3.19), Connecticut ($3.11) and Arizona ($3.07).
  • The nation’s top 10 largest weekly changes are: Ohio (-10 cents), Florida (-5 cents), Delaware (-5 cents), Indiana (+5 cents), Virginia (-5 cents), Utah (+4 cents), Maryland (-4 cents), Iowa (-4 cents), Kansas (-4 cents) and Illinois (-4 cents).

West Coast

Motorists in the West Coast region are paying the highest pump prices in the country, with all states on the top 10 most expensive list: Hawaii ($3.73), California ($3.71), Washington ($3.45), Alaska ($3.43), Oregon (3.32), Nevada ($3.31) and Arizona ($3.07). On the week, prices continue to mostly decline in the region by a penny or two. However, Hawaii and Alaska each increased by a penny.

According to EIA data for the week ending on June 8, inventories of gasoline grew by 400,000 bbl to reach 31.5 million bbl. Although inventories in the region now sit at their highest level for the second week of June since 2001, ongoing planned maintenance at Shell’s 158,000 b/d Martinez, CA refinery in the Bay area may restrict supplies this week.

Great Lakes and Central

Finding cheaper gas prices at the pump continues this week for the bulk of motorists in the Great Lakes and Central states. Ohio (-10 cents) tops the chart for the biggest weekly change in gas price averages in the country. Also making an appearance on the top 10 changes list: Iowa (-4 cents), Kansas (-4 cents) and Illinois (-4 cents). However, gas prices are more expensive for three states on the week: Indiana (+5 cents), Michigan (+2 cents) and Missouri (+1 cent).

Some states in the region are paying a hefty year-over-year increase. Indiana’s gas price is 80-cents more expensive than last year – the highest of any state in the country and region. Other states at the 55-cent or more mark include Michigan (+70 cents), Illinois (+64 cents), North Dakota (+62 cents), Missouri (+61 cents), Kentucky (+59 cents), Kansas (+58 cents), Wisconsin (+58 cents), Idaho (+57 cents), Ohio (+57 cents), South Dakota (+56 cents) and Minnesota (+56 cents).

Inventory levels bumped up slightly by 300,000 bbl on the week. Levels sit at the 52.5 million mark according to EIA.

South and Southeast

Florida (-5 cents) has the second largest decrease of any state in the country this week. The sunshine state and Georgia carry the most expensive gas price average, $2.77, of all states in the South and Southeast. On the week, state gas price averages are cheaper across the region with Oklahoma seeing the smallest drop at two cents.

For another week, the top six least expensive gas price averages in the country reside in the South and Southeast: South Carolina ($2.55), Mississippi ($2.58), Alabama ($2.58), Louisiana ($2.60), Oklahoma ($2.61) and Arkansas ($2.63).

Falling nearly 1.8 million bbl, the South and Southeast inventory levels dropped to 80 million bbl. However, levels sit just one million below last year at this time, according to EIA data.

Mid-Atlantic and Northeast

Gas prices are one to five cents cheaper across all states in the Mid-Atlantic and Northeast region with Delaware (-5 cents), Virginia (-4 cents), Maryland (-4 cents) and New Jersey (-4 cents) seeing the largest drops on the week. Even with the cheaper pump prices, four states continue to sell gas for $3 or more: Connecticut ($3.11), New York ($3.05), Pennsylvania ($3.04) and Washington, D.C. ($3.01).

Today’s gas prices are 50 to 64 cents more expensive compared to last year at this time with West Virginia seeing the smallest and Connecticut seeing the largest increases year-over-year.

Regional gasoline inventories fell to 65.6 million bbl after a 1.3 million bbl drop on the week. This latest decrease brings the year-over-year deficit for the region to 3.4 million bbl, according to EIA data.

Rockies

On the week, gas prices increased four cents in Utah ($3.19) and a penny in Wyoming ($2.93). Gas prices dropped two cents in Colorado while remaining stable in Montana ($2.95) and Idaho ($3.19). Utah and Idaho continue to carry the most expensive gas prices in the region and among the priciest in the country. The states are the seventh and eighth, respectively, most expensive in the country.

Motorists in the Rockies are paying, on average, 54 to 62 cents a gallon more compared to prices this time last year.

Inventories built by a small 92 bbl on the week. According to EIA data, levels register close to 6.9 million bbl, which is about 680,000 bbl less than this time last year.

Oil market dynamics

At the close of Friday’s formal trading session on the NYMEX, WTI decreased $1.83 cents to settle at $65.06. Oil prices trended marginally higher last week because of a stronger dollar. Looking ahead, this week’s prices will likely see fluctuation ahead of Friday’s OPEC meeting.

According to EIA’s latest weekly petroleum status report, total U.S. production jumped to around 10.9 million b/d, up about 100,000 b/d on the week. However, total crude inventories fell by 4.1 million bbl. Increasing crude exports supported the drop. Last week, exports of crude oil stood at 2.03 million b/d, a week-on-week gain of 316,000 b/d.

Domestic investment in crude production continues to grow. Last week, the U.S. added another oil rig, bringing the current total to 863. When compared to last year’s rig count at this time, there are 116 more active rigs today.

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.

WASHINGTON (June 13, 2018) – Consumers are spending $69 more a month to fill-up compared to last summer. According to AAA, gasoline expenses are accounting, on average, for seven percent of an American’s 2018 annual income, a one and half percent increase since summer of 2017. With strong summer consumer gasoline demand expected in the months ahead, AAA says motorists can expect little relief at the pump with the national gas price average ranging between $2.85 – $3.05 through Labor Day.

“Motorists can expect to spend at least $250 more on gas this season, but that won’t stop them from traveling. Summer is synonymous with road trips and vacation and we are not going to see Americans are giving up this pastime this year,” said Jeanette Casselano, AAA spokesperson. “The higher gas prices may just encourage travelers to shorten their driving distance. While others may pinch pennies by eating out less or finding more free family-fun activities while on vacation.”

According to a AAA survey conducted earlier this year, only one in three (33 percent) respondents said they would change travel plans if gas prices hit $3, while nearly half (47 percent) say $3.50 would be the game changer for their summer plans.

Then and Now Price Points: June 2017 vs. June 2018

As vacationers hit the road, they will find a quarter (25 percent) of all gas stations across the country are selling gas for more than $3/gallon. That is a stark difference from one year ago when only 5 percent of stations touted the $3 or more mark. The chart below compares the percentage of stations per state selling gas for $3.01 or more today versus one year ago.

State June 2017: Percentage of
gas station selling $3.01+
June 2018: Percentage of
gas station selling $3.01+
Alabama 0% 0%
Alaska 23% 100%
Arizona 1% 70%
Arkansas 0% 1%
California 53% 100%
Colorado 0% 13%
Connecticut 0% 82%
Delaware 0% 1%
District of Columbia 5% 36%
Florida 0% 4%
Georgia 0% 2%
Hawaii 34% 100%
Idaho 0% 99%
Illinois 0% 33%
Indiana 0% 5%
Iowa 0% 4%
Kansas 0% 0%
Kentucky 0% 15%
Louisiana 0% 1%
Maine 0% 12%
Maryland 0% 11%
Massachusetts 0% 20%
Michigan 0% 28%
Minnesota 0% 0%
Mississippi 0% 0%
Missouri 0% 0%
Montana 0% 15%
Nebraska 0% 11%
Nevada 11% 97%
New Hampshire 0% 2%
New Jersey 0% 26%
New Mexico 0% 19%
New York 1% 60%
North Carolina 0% 1%
North Dakota 0% 11%
Ohio 0% 0%
Oklahoma 0% 1%
Oregon 2% 98%
Pennsylvania 0% 66%
Rhode Island 0% 33%
South Carolina 0% 0%
South Dakota 0% 18%
Tennessee 0% 0%
Texas 0% 3%
Utah 1% 98%
Vermont 0% 4%
Virginia 0% 1%
Washington 12% 100%
West Virginia 0% 1%
Wisconsin 0% 4%
Wyoming 0% 25%

 

Don’t Let Your Tank Break Your Bank.

For when you are behind the wheel this summer, AAA offers these tips to improve your driving to get better gas mileage:

  • Observe the speed limit. Not only is it safer, it can help you save money.
  • Lose the weight. The heavier your car, the more fuel it uses.
  • Accelerate gradually. Avoid jackrabbit starts.
  • Drive during cooler parts of the day. Cooler, denser air can boost power and mileage.
  • Maintain recommended tire pressure. Low pressure reduces fuel economy and can damage tires.

The Outliers

Gas prices have shown some positive downward movement at the start of the month, but it is too early to determine if this is a trend. AAA has identified the following outliers that have the ability to drive gas prices – up or down – in the coming months.

  • OPEC – This year, global demand has outpaced global supply, which has driven the cost of crude oil to near-three year highs of $72/bbl in May. Since Memorial Day there have been conflicting reports that OPEC – which made a pact with other large producers to cut crude production in 2017 to help drain the then-glut of global supply – may or may not increase production to help ease supply concerns. The speculative news is already having a volatile impact, driving the price of crude down to $64/bbl and up to as high as $65/bbl levels in June. OPEC may announce a decision on increasing supply at its next meeting on June 22 in Vienna, Austria. Should OPEC and its partners increase supply motorists would likely see pump prices decrease late summer.
  • OPEC may announce a decision on increasing supply at their next meeting on June 22 in Vienna, Austria. Should OPEC and its partners increase supply motorists would likely see pump prices decrease late summer.
  • Hurricanes – Hurricane season is underway (June 1 – November 30). According to the National Oceanic and Atmospheric Administration (NOAA), there is a 75 percent chance of a “near- or above-normal” level of major storms this year. Moreover, NOAA’s forecasters predict a 70 percent chance of 10-16 named storms – of which five to nine could become hurricanes with winds of at least 74 miles per hour. The mere threat of a storm could force oil and gasoline companies, especially along the Gulf Coast, to halt gas operations, potentially leading to spikes in gas prices and limited regional supply.
  • Exports – Gasoline exports from the U.S. have grown throughout 2018. In fact, the Energy Information Administration’s (EIA’s) final measurement for March 2018 showed that exports hit 951,000 b/d and became the highest March rate on record. This trend is likely to continue throughout the summer, growing closer to one million b/d, which could help boost gas prices domestically because of robust demand. More than half of the U.S. gasoline exports go to Mexico, according to EIA.
  • Demand – According to the EIA’s latest reading for consumer gasoline demand, March 2018 saw nearly 9.45 million b/d, representing the strongest demand measurement for a March on record and a one percent increase from last year. AAA expects the high and potentially record-breaking consumer demand trend to continue through the summer, pushing prices higher.

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.

About AAA: As North America’s largest motoring and leisure travel organization, AAA provides more than 58 million members with automotive, travel, insurance and financial services through its federation of 36 motor clubs and nearly 1,100 branch offices across North America. Since 1902, the not-for-profit, fully tax-paying AAA has been a leader and advocate for safe mobility. Drivers can request roadside assistance, identify nearby gas prices, locate discounts, book a hotel or map a route via the AAA Mobile app. To join, visit AAA.com.

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