CAMARILLO, Calif. -- The U.S. average retail price of regular grade gasoline is up 2.73 cents in the past two weeks to $3.2790. It is up 6.14 cents over the past four weeks, according to the most recent Lundberg Survey of approximately 2,500 U.S. gas stations. The main source of the increases: Higher oil prices are working their way to the street.
Crude oil prices, for example the two main light-grade benchmarks WTI and Brent, edged up again over the two weeks. The weighted price change is a hike of around 4-cents-per-gallon equivalent.
Another rise at the pump of perhaps 2-4 cents over the next several days is taking shape. Refiners are paying a little more for crude at a time when their margins on gasoline have skinnied. Refiner margin on gasoline shrank about 13 cents per gallon in the past two weeks.
Meanwhile, retailer gasoline margin recovered in the past two weeks by 9.01 cents per gallon. It is now back in more normal territory of 14.27 cents on regular grade, as average retailers passed through wholesale gasoline price hikes from refiners, although in some markets retail margin has yet to recover. In general, it is now refiners' turn to "get well" on gasoline.
Should crude-oil prices leap up from here, then the average pump price will rise more than the expected 2 to 4 cents. But an oil price surge is not currently looming. If the impact of the Keystone Pipeline announcement that its southern leg will be operating next month is already built into the now higher WTI price due to consequent drainage of the WTI glut at Cushing, Okla.--and if the impact of the Iran agreement is reflected in the price of Brent with no immediate flood of Iranian crude--then absent potential other oil-market upheaval, stable oil prices may sustain.
For now, slight up-ticks at the pump are likely as latest oil prices hit the street. In favor of gasoline consumers, the current price is nearly a dime under last year's point, demand is exhibiting pent-up energy despite the still-weak economy and supply is flush.
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.
Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.