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AAA: Highest October gasoline demand since 2006

gas pricesAccording to the Energy Information Administration, the latest gasoline demand measurement is the highest for the end of October since 2006.

At $2.53 per gallon, today’s national price for gas is six cents more than a week ago, two cents more than a month ago and 31 cents more than a year ago.

“October has seen strong demand numbers likely, in part, due to consumers taking advantage of the unseasonably warm weather rather than spending time indoors,” said Tammy Arnette, Senior Public Affairs Specialist for AAA Mid-Atlantic. “As consumers fill up their tanks more frequently, we are seeing supply levels tighten and gas prices increase. However, we don’t expect this increase to be long-term.”

The national gas price average during the second half of October was relatively stable, fluctuating a penny or two until October 31. Since then, the national price has seen upward movement, primarily resulting from increased demand.

Mid-Atlantic and Northeast

Gas prices continue to be volatile in the Mid-Atlantic and Northeast regions with motorists either paying more or seeing stability at the pump. Not one state saw a decrease. A handful of states saw sizeable increases to gas prices on the week: Pennsylvania (+6 cents), Delaware (+6 cents), New Jersey (+5 cents), Maine (+5 cents) and Maryland (+5 cents). However, Massachusetts, Connecticut and Rhode Island saw no change to prices at the pump.

With a 2.9 million bbl decrease in inventory, the region saw the biggest drop of any in the country. With nearly 54 million bbl, inventory is nearing some of the lowest levels of the year.  As supplies tighten, it brings a nearly 7 million bbl deficit compared to this time last year.

         

 

Oil market dynamics

Last week, WTI hit a new 2017 high at $54.54 and the market will likely build on those gains this week. At the close of Friday’sformal trading session on the NYMEX, WTI settled up $1.10/bbl at $55.64/bbl. The latest EIA report showed major inventory draws and increased exports, both of which have helped push oil prices higher. Crude oil inventories slid by 2.4 million bbl, while crude oil exports reached a new record of 2.133 million b/d. All of this news has given market observers renewed confidence in seeing oil prices pushing higher as supplies appear to grow tighter and demand remains strong, fueled by oil demand growth in key export markets.

Last week, Baker Hughes, Inc. reported that the U.S. oil rig count dropped by eight rigs, bringing the total to 729. The news follows reports that at OPEC’s next meeting in Vienna on Nov. 30, OPEC and allied non-OPEC producers will review the agreement to reduce production through March of next year. Some reports have stated that the group may extend the agreement through the end of 2018, which if true, will likely help boost oil prices through the end of the year.

Motorists can find current gas prices along their route with the free AAA Mobile app for iPhone, iPad and Android. The app can also be used to map a route, find discounts, book a hotel and access AAA roadside assistance. Learn more at AAA.com/mobile.

 
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