AAA: Nationwide gas prices at lowest level since July 12

Retail prices are falling across the nation. Analysts say Virginia turns up some of the more competitive pump numbers, an indication that Commonwealth consumers have been helped by the lower gasoline price structure that took effect on July 1. The Maryland state average is $3.61 as of Friday morning, which is 15 cents higher than on July 1 when Maryland’s new gas tax also took effect.  Approximately four cents of Maryland’s gas cost can be attributed to the tax increase.

The national average price for regular unleaded gasoline dropped to $3.58 per gallon Friday, a five cent drop in the past week.  The national retail average is at the lowest point since July 12. This current price is eight cents more expensive than one month ago and eight cents cheaper than the same day last year. Nationally, the pump price average is 21 cents lower than the peak price this year of $3.79 on February 27 and 53 cents below the all-time daily high of $4.11 per gallon on July 17, 2008. Gas prices appear to have hit a summer-low of $3.47 onJuly 7.

Tropical storms in the Gulf Coast this season have not yet been a factor in prices; however, analysts say that storms remain a threat to the market.  While not as busy as forecasters predicted, the Atlantic hurricane season is still expected to be unusually active throughout the season, according to an Aug. 8 report by the National Oceanic and Atmospheric Administration.

The price of U.S. West Texas Intermediate (WTI) crude oil has retreated somewhat from the 16-month high of $108.05 per barrel on July 19, but it remains near the highest level for this time of year since 2008.  The week kicked off with crude oil closing a few pennies lower at $106.56 per barrel on Monday, August 5.  The commodity closed around a dollar lower with each consecutive day.  As of Friday morning, the price of oil was climbing for the first time in six days based on favorable economic data from China.  However, at Friday’s close, crude oil settled at $105.97, slightly less than one percent on the week.

In its weekly report, the Energy Information Administration (EIA) data showed crude oil stocks saw a 1.3 million barrel decrease that put total inventory at 363.3 million barrels. Inventories are now 6.6 million barrels below last year. Gasoline stocks increased 0.1 million barrels to 223.6 million barrels.  Gasoline demand is up from last week to 9.246 million barrels per day (bpd).  The four-week average demand level is 9.026 million bpd, compared with 8.737 million bpd in 2012.

“Retail prices continue to fall, but future prices will likely depend on the hurricane season and any potential refinery problems,” said Martha M. Meade, Manager of Public and Government Affairs for AAA Mid-Atlantic. “Refineries will begin the changeover to winter-blend gas on September 15, which could cause prices to remain flat as long as refineries run smoothly.”

AAA expects that gas prices in the coming weeks could increase due to the potential for late-summer hurricanes and potential refinery problems. These types of issues can disrupt production, distribution and gasoline supply at a time when many Americans are filling up their tanks for end of summer travel.