Pump Prices Packing Punch to Motorists, but Show Signs of Tapering Off
At $2.81, the national gas price average is 45 cents more expensive than a year ago. With the unofficial kick-off to summer just weeks away, prices are expected to increase, but a tapering trend may be emerging.
“If this past week’s moderate increases are any indicator of what’s to come, the fast rate at which gas prices were increasing may be slowing down,” said Jeanette Casselano, AAA spokesperson. “On the week, the national average held steady and 19 state averages remained flat or saw decreases in gas prices. Despite this stability, drivers on the West Coast and in Idaho, Utah and Pennsylvania are paying $3/gallon.”
Locally, South Jersey motorists are paying an average of $2.82 per gallon of unleaded gas, a 2-cent decrease from last month ($2.84). However, today’s price is 16 cents more than one month ago ($2.66) and 51 cents more than last year ($2.31).
- The nation’s top 10 most expensive markets are: California ($3.63), Hawaii ($3.63), Washington ($3.32), Alaska ($3.28), Nevada ($3.25), Oregon ($3.23), Idaho ($3.11), Utah ($3.09), Pennsylvania ($3.02) and Connecticut ($2.98).
- The nation’s top 10 states with the largest yearly increases are: Indiana (+66 cents), California (+66 cents), Utah (+63 cents), Arizona (+60 cents), Hawaii (+56 cents), Idaho (+55 cents), Nevada (+55 cents), Illinois (+52 cents), New Jersey (+51 cents) and Michigan (+51 cents).
Mid-Atlantic and Northeast
On the week, Pennsylvania’s gas price average held steady at $3.02, while Connecticut ($2.98), New York ($2.95) and Washington, D.C. ($2.95) inch closer toward the $3 mark. In the region, gas prices moderately increased on the week with the largest jump of four cents in Washington, D.C. On the flip-side, North Carolina and West Virginia saw decreases of a penny on the week while gas prices in Maryland ($2.79), Virginia ($2.62), Delaware ($2.76) and Tennessee ($2.89) held steady.
At $2.89, New Jersey’s gas price average is 51-cents more expensive on the year – the largest year-over-year difference in the Mid-Atlantic and Northeast region.
Gasoline inventories grew by a substantial 1.3 million bbl on the week, according to the EIA. At 62 million bbl total, Mid-Atlantic and Northeast inventories are at their highest levels in nearly two months.
Oil market dynamics
At the close of Friday’s formal trading session on the NYMEX, WTI increased $1.29 cents to settle at $69.72 – a new high for the year. Oil prices ticked up higher last week following reports that President Trump will potentially decline to recertify the Iran nuclear deal on May 12 and may impose new sanctions on the country. Iranian Foreign Minister Mohammad Javad Zarif responded that the country is unwilling to renegotiate the deal it set with the U.S. in 2015 under the Obama Administration. The decision to not recertify the deal could increase tensions in the volatile region, leading to global supply disruptions. Crude prices are likely to continue climbing as the May 12 deadline for the recertifying draws near and it becomes increasingly likely that the U.S. will decline to renew it.
Additionally, EIA’s weekly petroleum status report noted that U.S. crude production hit another record high at 10.62 million b/d. The growth in production occurred alongside growth in crude inventories, which grew by 6.2 million bbl last week. At 436 million bbl, inventories are nearly 92 million bbl lower than they were at this time last year.
Domestic crude production will likely see continued growth through 2018 – supported by a steady increase in active oil rigs. Baker Hughes, Inc. reported that last week, the U.S. added nine rigs, placing the total at 834. The total rig count is now 131 more than the figure at the same time last year.
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.