Crude Rebound Ends Gas Price Decline
Further dramatic drops not in the cards, says Lundberg
CAMARILLO, Calif. -- The two-month drop in gasoline prices across the country has stopped. The average price of a gallon of regular gasoline is $3.62 per gallon, down about one cent over the past two weeks, according to the most recent Lundberg Survey of approximately 2,500 U.S. gas stations. The price is a 38-cent drop from the beginning of May, when the average leveled off at $4 per gallon.
Further dramatic drops probably are not in the cards.
Crude oil's recent rebound is the reason the average retail gasoline [image-nocss] price fell just 1.33 cents. One day after the International Energy Agency's announcement that Strategic Petroleum Reserve (SPR) would be tapped and offered for sale (with the U.S. portion amounting toone million barrels per day), the oil price did fall more than $4 per barrel. But after just two short days, the price crept back up and on July 8 the price was nearly a dollar above its pre-SPR announcement level.
The oil price hike hit wholesale gasoline markets quickly and is already on the street in many locations, especially in the Midwest.
Although the United States is in the middle of peak demand season, demand is weak, a result of the economy, with the unemployed having no jobs to drive to and from each day.
Camarillo, Calif.-based Lundberg Survey Inc. is an independent market research company specializing in the U.S. petroleum marketing and related industries.
Click herefor previous Lundberg Survey reports in CSP Daily News.