CAMARILLO, Calif. — Nationally, the retail price of regular-grade gasoline remained at $2.69 per gallon, the same as on Oct. 25, 2019, according to the most recent Lundberg Survey of U.S. fuel markets. In whole pennies, at least: The price moved up a microscopic 0.30 cents. While unusual, such a lack of significant change did happen recently, with a mere 0.32-cent uptick from Sept. 27 to Oct. 11.
While there are always myriad factors pulling up and pushing down the prices of crude oil and refined products, in these two weeks many of the influences were to a mild degree. World oil prices were quite stable, remaining within the range they have been in during most of 2019, manifesting a small increase as of Nov. 8. Beyond the mammoth importance of crude oil on gasoline prices, the U.S. gasoline market was relatively stable as well, with small margin losses on gasoline for both sectors of downstream.
Refiners lost a little, and may well lose further, as more maintenance and repair projects are concluded. This would coincide with the progression of seasonal gasoline demand shrinkage. The Nov. 3 end of Daylight Saving Time was a dramatic ushering-in of the winter demand season, because motorists shrink back from the shorter daylight hours and worsening weather.
Refiners, marketers and retailers are likely to chase sales as best they can as supply is augmented while demand declines. The gasoline supply and demand imbalance will weigh on price unless the crude oil market, for reasons of its own, intervenes.
Retailers lost 0.73 cents per gallon (CPG) in these two weeks. The national average margin for regular grade is 23.82 cents currently. An example of average margin appearing very robust is Portland, Ore., now at 62.42 CPG.
Retailers got 21.25 CPG richer, according to the Nov. 8 snapshot, as wholesale gasoline prices dropped a sizable 23.73 cents but the average retail price went down just 2.48 cents. Meanwhile, in Baton Rouge, La., wholesale prices did a no-change, dropping three-hundredths of one penny over the two weeks while retail was still slipping downhill with a decline of 4.29 cents. So Portland's average margin dropped to a repulsive 1.83 CPG.
With U.S. gasoline demand so far this year turning in very weak growth, and the seasonal decline underway, it's lean times for many downstream competitors.
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 of U.S. fuel markets.