CAMARILLO, Calif. -- The U.S. average retail price of regular grade is now $2.2021, 26.92 cents per gallon lower than it was three weeks ago, according to the most recent Lundberg Survey of approximately 2,500 U.S. gas stations. Motorists are enjoying a discount of $1.14 from one year ago. The price is the lowest since late April 2009 more than five years ago.
Crude has been the overwhelmingly biggest cause of the crash. Oil prices continue weak from ongoing supply and demand factors, with an additional down pull from the strengthening dollar.
On the gasoline side, fabulous stocks and U.S. refinery run rates both prevail. Gasoline prices would have fallen even more if not for spikes in ethanol and RINs prices staying some of the refiners' heavy punches.
Wholesale gasoline price cutting has not yet abated. Over three weeks some undramatic up moves made brief appearances, especially in the Western region. For example, PADD 5 DTW prices edged up 1.42 cents per gallon on average on January 1 versus New Year's Eve and 4.83 cents on January 2, but then headed right back down. PADD 5 branded and unbranded racks behaved similarly, but the upward blip was limited to January 1 over December 31, then price cutting resumed. The U.S. average branded rack price is 137.16 cents per gallon, 20.49 cents lower than on December 19.
U.S. refiners gave up a little of their underwhelming gasoline margins during the three weeks. Retailers gave up more than refiners did, after a wondrous winning streak. Regular grade retail margin is 27.04 on January 9, 6.83 cents narrower.
If crude oils, whose prices the futures markets do not indicate will have a deeper crash, are stable near term, then retail gasoline may see a bit more price cutting but not of this recent magnitude.
Camarillo, Calif.-based Lundberg Survey Inc. is an independent market research company specializing in the U.S. petroleum marketing and related industries.
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