BOSTON -- Gasoline prices leapt more than 12 cents per gallon (CPG) this week, the biggest increase in more than a year and just the beginning of a longer, spring upward climb.
According to Boston-based GasBuddy, the national retail average for regular gasoline jumped 12.1 CPG in the past week to $1.938 per gallon. This is a 24.1-CPG premium over a month ago. The culprits: a 45% monthly jump in oil prices, and a drawdown in gasoline supplies as demand rallies and refineries switch from winter to summer gasoline blends.
“The large jump in crude-oil prices comes amidst record oil inventories, yet it's the mere threat that oil supply could be slashed from OPEC and non-OPEC countries at the same time oil demand is growing [that is] driving prices higher,” said Patrick DeHaan, senior petroleum analyst for GasBuddy. “And while oil inventories sound staggering at over 500 million barrels, that number represents 26 days of U.S. oil consumption, a rise of three days vs. inventories a year ago.”
Averages rose in all 50 states in the last week, with 32 states seeing a 10 CPG or greater jump, according to GasBuddy. The biggest jumps in state averages came in Missouri, up 18.7 CPG week over week, followed by Illinois (17.9 CPG), Arizona (17.7 CPG), Kentucky (17.5 CPG) and Virginia (17.3 CPG). The smallest increases were in Hawaii (0.7 CPG), Alaska (1.7 CPG) and Iowa (1.9 CPG).
On a year-over-year basis, averages still are significantly down in all 50 states. Western states saw the greatest annual discounts, led by Oregon (-80 CPG), California (-79.9 CPG), Alaska (-75.9 CPG), Arizona (-73.7 CPG) and Nevada (-69.1 CPG). States in the Great Lakes region had the smallest discounts, including Indiana (-28.5 CPG), Ohio (-30.9 CPG), Illinois (-31.6 CPG), Kentucky (-33.2 CPG) and Michigan (-34.1 CPG).
According to GasBuddy data, only 0.3% of gas stations in the United States were selling regular gasoline at or under $1.50 per gallon at the start of this week, compared to 30% at or below that price point a month ago. Meanwhile, more than 82% of sites were selling gasoline for more than $1.75 per gallon, compared to only 31% of sites at this price point a month ago.
The diesel average rose only 7 CPG in the past month to $2.058 per gallon, with the increase kept relatively moderate because of weak demand thanks to the mild winter weather.
Because seasonal refinery maintenance and the transition to summer-blend gasoline are ongoing, GasBuddy expects the national average to increase an additional 20 to 55 CPG before hitting an April or May peak.
“At the end of the day, we expect this rally in gasoline prices to run for another month or two before stalling out,” said DeHaan. “Perhaps the best news? Motorists still could see the cheapest average summer gasoline prices in over a decade.”