The U.S. average retail price of regular-grade gasoline is up 5.94 cents per gallon (CPG) in the past two weeks, to $3.1949, according to the most recent Lundberg Survey of U.S. fuel markets. The U.S. average diesel fuel price is up 11.98 CPG in the same period, to $3.7681.
Although oil prices are not up in the past two weeks, they are up dramatically from a month ago. Overall, the unknowns of upcoming changes to U.S. trade policies make for numerous contradictory expectations among traders, oil companies and institutions. The threat of tariffs and deeper sanctions on Russia, new sanctions upon Iran and tariffs upon both Canada and Mexico would in any combination make for higher oil prices and price volatility.
Such supply negatives for the United States may prove to be outweighed by eventual U.S. domestic petroleum production expansion from U.S. government incentives, but these sit further out on the timeline.
Extreme winter weather is disrupting refining and transportation operations in some locations and spooking diesel prices due heavily to surging demand for their cousin, home heating oil.
U.S. refiners have finally regained margin on gasoline, but there is far to go and margin remains too low. Retailers, meanwhile, lost 2.29 cents gasoline margin in the past two weeks. Retail margin on regular grade is 32.61 CPG on January 24.
The cacophony of crude oil price projections based upon entirely ‘iffy’ trade policy moves by the United States and other countries, when calmed, will deliver at least a basis from which to project U.S. retail fuel prices. For now, further retail price increases, perhaps small, seem more likely than price cuts.
In San Diego, retailers lost 9.8 cents in regular-grade margin in the past two weeks. Margin sits at 47.03 cents on Jan. 24. Wholesale, weighted by class of trade, jumped by more than 15 CPG in this market, while the average retail price trailed at 5.4 cents higher.
The margin loss was even deeper in St. Louis: The average retail price rise a mere half a penny, while the weighted wholesale price increased 12.5 CPG. This cost St. Louis an average margin loss of 22.98 cents. The St. Louis margin is 30.12 CPG per Lundberg calculations.
Click here for previous Lundberg Survey reports in CSP Daily News.
Trilby Lundberg is publisher of the Lundberg Survey of U.S. fuel markets. Lundberg Survey Inc. is based in Camarillo, California.
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