BOSTON -- Summer gasoline prices are set to hit their lowest point in a decade or more.
That is according to Patrick DeHaan, senior petroleum analyst at Boston-based GasBuddy.com. But do not expect a repeat in 2017, he cautioned.
“I don’t see our current environment of a healthy economy and low gas prices repeating itself again soon, so my advice to motorists is simple: Don’t delay your summer travel plans," said DeHaan. While it is too early to forecast gasoline prices for summer 2017, DeHaan said they may be 50 cents per gallon (CPG) or higher.
The current national retail average grew 1.3 CPG over the past week to hit $2.223 per gallon as of this Monday, which is still almost 50 CPG lower than this same date a year ago. Of the largest 16 price movements in the past week, all were increases, according to GasBuddy. Prices rose in 34 states week over week, with the biggest gains in Indiana (up 9.3 CPG), Ohio (8.6 CPG), Kentucky (8.2 CPG), Montana (6.8 CPG) and Washington (6.1 CPG). Refinery issues pushed the price increases in the Midwest.
Average retail prices fell in 16 states. Delaware had the biggest decline, off 3.2 CPG week over week, followed by Georgia (-2.3 CPG), Maryland and West Virginia (-1.8 CPG), and Florida (-1.5 CPG).
Weekly gas-price movements across much of the United States were relatively minor, according to GasBuddy, as crude-oil prices rise in a rebalancing of supply and demand. Oil production in the United States is 8% lower than its peak in summer 2015, while strong demand threatens to draw down inventories faster than expected.
Month over month, Utah and Idaho have seen the greatest increases in their average retail gasoline price, up 28 to 30 CPG. This compares to the average month-over-month increase of 15 CPG. As of late last week, both states’ averages were around $2.38 per gallon and trending upward. In a blog post, GasBuddy analyst Will Speer said supply issues are pressuring both states. Idaho has no refineries so it imports much of its supply via pipeline from Utah, which has five small refineries in the Salt Lake City area.
Because both states rely on the same refineries, their gasoline prices tend to move in tandem. Refinery utilization in the western region is currently below 80%. At this same time last year, refineries were running at 96%. Speer said it is possible the Salt Lake City refineries “are having issues,” considering Utah and Idaho are facing the biggest monthly price increases. In addition, because both states are landlocked, it is difficult to import additional supply to relieve the price increases.
Year over year, the national average is 48.6 CPG lower, with motorists paying $190 million less per day. Some of the biggest year-over-year price drops are on the West Coast, with California off $1.02 per gallon, followed by Nevada (-81 CPG), Alaska (-70 CPG), Arizona (-62 CPG) and Oregon (-59 CPG).
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