GAS PRICES FALL TO LOWEST LEVEL SINCE FEBRUARY, HEAD TO POSSIBLE NATIONAL AVERAGE OF $2.99 BY CHRISTMAS
For the third straight week, the nation’s average gas price has declined, falling 12.4 cents from a week ago to $3.52 per gallon today according to GasBuddy data compiled from more than 11 million individual price reports covering over 150,000 gas stations across the country. The national average is down 22.7 cents from a month ago and 14.1 cents per gallon higher than a year ago. The national average price of diesel has fallen 7.9 cents in the last week and stands at $5.20 per gallon.
“As millions of Americans hit the road for Thanksgiving, we saw gasoline prices continue dropping coast to coast last week, and a new record was set for the largest single day decline in the national average. In addition, 47 of the nation’s 50 states have seen diesel prices falling as well, providing well-needed relief ahead of the holidays and helping to stem the rise in inflation,” said Patrick De Haan, head of petroleum analysis at GasBuddy. “All the metrics look very positive for motorists as this week is likely to continue seeing falling gasoline prices, with many areas falling to the lowest level since Russia’s invasion of Ukraine in February. It’s entirely possible the national average price of gasoline could fall under $3 per gallon by Christmas, which would be a huge gift to unwrap for motorists after a dizzying year at the pump.”
The bears have run rampant through oil markets, with prices continuing to come under heavy selling pressure as China sees protests for its zero-Covid policies, shut downs of major cities, and U.S. demand comes under seasonal pressure as temperatures cool off and Americans do more online shopping than driving to malls. In early trade, a barrel of West Texas Intermediate crude oil was down $2.06 to $74.22 per barrel, the lowest since Russia’s invasion of Ukraine, and a $5 drop compared to last Monday’s $79.52 per barrel start. Brent crude was also solidly in the red, down $2.48 to $81.15 per barrel, down over $6 from last Monday’s $87.13 per barrel start. In addition to China’s Covid crisis, the Biden Administration approved Chevron to export crude oil from Venezuela, as the administration sets the stage for discussions on future elections, adding downward pressure to oil.
According to Baker Hughes, last week’s U.S. rig count was up by 2 rigs to 784 and was 215 rigs higher than a year ago. The Canadian rig count was down 7 rigs to 194 and was 23 rigs higher than a year ago.
OIL AND REFINED PRODUCTS
Last week’s report from the Energy Information Administration showed a 3.7 million barrel drop in oil inventories, which are slightly lower (0.5%) from the year ago level, while the SPR fell 1.6 million barrels and is 35% below last year’s level. Domestic crude oil production was unchanged at 12.1 million barrels per day, up 600,000bpd from a year ago. Gasoline inventories jumped 3.1 million barrels, and are now about that amount above the year ago level, while distillate inventories are up by 1.7 million barrels, a needed gain as supply remains tight, and now stand 13% below the five year average for this time of year. Implied gasoline demand, a proxy for retail demand, fell 416,000bpd to 8.33 million barrels per day. Refinery utilization rose 1.0 percentage points to 93.9%, a sign that refining remains unseasonably strong as product inventories remain tighter than normal.
According to GasBuddy demand data driven by its Pay with GasBuddy card, U.S. retail gasoline demand fell last week (Sun-Sat) by 5.0% as motorists pre-filled up and celebrated Thanksgiving. Broken down by PADD region, demand fell 4.3% in PADD 1, fell 4.8% in PADD 2, fell 7.6% in PADD 3, fell 2.5% in PADD 4, and fell 5.2% in PADD 5.
GAS PRICE TRENDS
The most common U.S. gas price encountered by motorists stood at $3.39 per gallon, down 10 cents from last week, followed by $2.99, $3.29, $3.19, and $3.49 rounding out the top five most common prices.
The median U.S. gas price is $3.39 per gallon, down 10 cents from last week and about 13 cents lower than the national average.
The top 10% of stations in the country average $4.89 per gallon, while the bottom 10% average $2.75 per gallon.
The states with the lowest average prices: Texas ($2.83), Oklahoma ($2.94), and Arkansas ($2.99).
The states with the highest average prices: Hawaii ($5.14), California ($4.97), and Nevada ($4.66).
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