The Mid-Atlantic region is beginning to see a rebound in gas prices following increased demand during the July 4th holiday weekend.
“On the heels of gas prices dipping to their lowest level of the year, many regions are seeing a slight rebound at the pump,” said Tammy Arnette, Senior Public Affairs Specialist for AAA Mid-Atlantic. “Increased demand as a result of the July 4th holiday is responsible for the uptick, which could be short lived as demand levels out and refineries continue to produce more gasoline than the market needs.”
Some states, including Virginia, are experiencing a slight increase in gas prices over last week. After a 33-day decline, the national gas price average rebounded slightly this week. Today’s national average price for a gallon of regular gasoline is $2.26, which is three cents more than a week ago, nine cents less than a month ago and two cents more than this day a year ago.
At $2.23, Tuesday’s gas price average was the lowest price on Independence Day since 2005 and the lowest so far this year.
At the close of NYMEX trading Friday, WTI crude oil decreased $1.81 on the week to settle at $44.23. Oil markets remain oversupplied despite a pledge by the Organization of the Petroleum Exporting Countries (OPEC) to cut production through March 2018. A monthly Reuters’ production survey found output jumped to a 2017 high last month as OPEC members Nigeria and Libya (both exempt from the out-put cut agreement) continued to pump more oil.
July gasoline consumption was expected to be high but this remains to be seen as analysts look at the month of June. The implied monthly demand for June 2017 works out to be 9.564 million barrels per day, 99,000 barrels per day less than June of 2016. Tom Kloza, Global Head of Energy Analysis for the Oil Price Information Service (OPIS) believes that June 2017 now looks less dynamic than June 2016, even though gas prices were cheaper at month’s end. Without high demand rates for gasoline, prices may stay on the low end a bit longer.
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Chris Graham
