CAMARILLO, Calif. -- The U.S. crude oil price benchmark West Texas Intermediate dropped 1.24 cents per gallon equivalent, between March 10 and March 24, according to the most recent Lundberg Survey of approximately 2,500 U.S. gas stations. In the same two-week period, the national average retail price of regular grade gasoline fell 1.26 cents per gallon.
During 2017 to date, just a week short of the first quarter, the average pump price has lived within a 6-cent range, a rather stable arena.
Meanwhile, the country's gasoline retailers have not enjoyed stability in their margin, which has ranged twice that much.
During the latest two weeks, retailers lost more than a penny in gasoline margin and now garner just 15.10 cents. Margin has been starkly skinny all year so far except for one bright spot in late January.
Margin conditions are starkly low in several markets, notably the Gulf Coast. Take Houston: Between March 10 and March 24, margin on regular was slashed in half, from an unlovely 15 cents to a far worse 7 cents.
During those two weeks, their weighted average wholesale buying price jumped up nearly 8 cents, but retail gained less than half a cent. On average, they took a bad one on the chin.
Pressure on retail margin to recover ground continues. That, and seasonally rising refining costs for summer blend compliance, plus a rebound in RIN prices affecting refiners who have to buy them, and gasoline output curtailment during spring maintenance projects, want retail prices to rise, while low crude oil prices and the still incipient spring gasoline demand climb want them to fall.
Short term and on average, retail gasoline prices are unlikely to exhibit big changes in either direction. But since crude oil prices are the boss of gasoline, and their weakness seems entrenched, the average pump price is leaning toward another gentle drop.
Camarillo, Calif.-based Lundberg Survey Inc. is an independent market research company specializing in the U.S. petroleum marketing and related industries.
Click here for previous Lundberg Survey reports in CSP Daily News.
Trilby Lundberg is publisher of the Lundberg Survey, a survey of approximately 2,500 U.S. gas stations.