Gas prices in the Mid-Atlantic region continue to climb, although the pace has slowed somewhat in the past few days.
“The sticker shock of the past two weeks seems to be stalling, as gas price increases begin to ease a bit,” said Tammy Arnette, Senior Public Affairs Specialist for AAA Mid-Atlantic. “However, as seasonal demand increases, motorists should expect continued volatility at the pump, positioning pump prices to climb higher by the summer.”
Local refiners wrapped up the switch to summer-blend gasoline, resulting in significant price increases over the last two weeks. Today’s national average price for a gallon of regular unleaded gasoline is $2.42. This price is a penny more expensive than one week ago, 13 cents more than one month ago and 29 cents more than one year ago.
At the close of Friday’s formal trading session on the NYMEX, WTI was down $3.56 on the week to settle at $49.62 per barrel. A surprise build (1.5 million barrels) in U.S. gasoline stockpiles pointing to a weaker-than-expected demand sent oil prices down by almost four percent mid-week, marking the steepest drop since March 8. OPEC countries plan to meet on May 25 to discuss how an extension of their agreement could further rebalance global oil supply and inventory levels. Traders will continue to watch the impact that increased U.S. production has on OPEC’s efforts to rebalance the market.
Data from the U.S. Energy Information Administration (EIA) this week showed that domestic crude supplies fell by 1 million barrels for the week ending April 14, but gasoline inventories unexpectedly climbed. The International Energy Agency (IEA) released its monthly report this week stating that the global oil market could be very close to balancing supply and demand. However, the agency noted that the absence of OPEC extending its production cuts could result in a more volatile second half of the year, due to a tighter U.S. supply and lower global oil demand.
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