AAA: Increase in oil prices pushing gas prices up
Most regions in the Mid-Atlantic saw more gas price increases this week, including Virginia. Today’s national gas price average of $2.31 is three cents higher than a week ago, seven cents higher than a month ago and 17 cents more than a year ago.
“Prices at the pump continue to climb, albeit slowly, as we head into August,” said Tammy Arnette, Senior Pubic Affairs Specialist for AAA Mid-Atlantic. “Motorists have enjoyed relatively cheap prices at the pump throughout the summer driving season, so we do not expect price increases to affect demand heading into August, the final month of summer vacations and road trip travel.”
For much of the summer, gas prices have been fairly cheap. Motorists are used to seeing gas prices surge as the summer driving season kicks off. However, bucking the typical price trends, gasoline hit a new national low of $2.23 a gallon in June amid cheap oil prices and high rates of production at refineries.
At the close of NYMEX trading Friday, WTI crude oil increased $3.94 on the week to settle at $49.71. Year to date, oil prices have dropped by around 11 percent. Oil prices rallied throughout the week, increasing each day and scoring their biggest single-session gain of 2017 on Tuesday as a result of data showing a fourth-consecutive week of declines in U.S. crude inventories.
August is a huge vacation road trip month which will eat into gasoline and oil inventories. Strong demand coupled with crude oil and gasoline inventory draws are pushing crude oil and wholesale gasoline prices higher. As a result, retail prices for gasoline are climbing. However, by mid-September, refineries switch to less-expensive, winter-blend gasoline, which typically helps ease prices at the pump.