CAMARILLO, Calif. -- The U.S. average regular grade gasoline price increased 15.83 cents in the past two weeks, to $2.6442 per gallon, according to the most recentLundberg Survey of approximately 5,000 U.S. gas stations. Suddenly, it was a passthrough of crude oil prices that had been climbing for a month. The passthrough is mostly complete.
Another few cents are needed by retailers, who regained just one penny in margin in the past two weeks and are making less than 8 cents per gallon on regular, well beneath [image-nocss] the norm.
Other than that modest needed recovery, the retail price run-up is probably finished. For retail gasoline to climb from here, it would take either a substantial oil price hike, which is unlikely, or healthy U.S. gasoline demand growth, which is impossible.
It is an unhappy trio of underemployed motorists, underproducing refiners and underprofiting retailers facing both lower demand and lower margin. The only consolation is the current $1.20-per-gallon discount under the year ago price, offering a little bit of support for demand.
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