The national average price of regular unleaded gas fell last weekend after rising for 40 consecutive days, which was the longest streak of daily increases since 2011.
During this period, average gas prices increased 43 cents per gallon. Friday’s national average price of $2.44 per gallon was down two cents from last week, indicating that the upward trend in prices at the pump has slowed. While 20 cents higher than month ago prices, Friday’s average remained $1.06 below year ago prices. Retail gas prices typically trend higher this time of year as suppliers undergo maintenance and plan to reduce winter grade fuel in preparation for the changeover to summer-grade gasoline by the May 1 compliance date, which is more costly to produce.
Higher prices at the pump, coupled with higher heating costs this winter, sent consumer confidence to a four-month low in March. Sentiment had buoyed during the record 123-day daily decline in gas prices.
The global price of crude oil remains volatile due to speculation about possible production cuts due to oversupply and news of rising global demand. Absent any intervention from OPEC, global prices are expected to continue to fluctuate as markets attempt to self-regulate and find balance. Crude oil crumbled Thursday to its lowest level in March, just above $47 per barrel, due to worries about rising gasoline stocks and lackluster demand. At the close of Friday’s formal trading on the NYMEX, crude oil settled at $44.84 per barrel, down nearly 11 percent on the week, and positioned to test six-year lows.
The Energy Information Administration (EIA) noted in its weekly report hints that unwieldy crude inventories could soon transition into excessive gasoline stocks. Crude oil inventories rose 4.5 million barrels to 448.9 million barrels, with an expectation to give way to even larger builds in the next couple of weeks. Modern-day commercial stock records of 448.9 million barrels (about 79 million bbl above last year) are inclined to rendezvous with a 460-million-barrel storage level before April. Gasoline stocks remained virtually unchanged near 240 million barrels. Gasoline demand dropped 115,000 barrels per day (bpd) to 8.5 million bpd, down 434,000 from the same time last year, reflecting the effect winter weather had throughout the country last week.
“It is too soon to draw any hard and fast conclusions from just three or four days of data, but it appears recent spring price spikes have taken a breather,” said Martha M. Meade, Manager of Public and Government Affairs for AAA Mid-Atlantic. “This is a welcomed trend following four weeks of double-digit price increases, and could indicate price stabilization or that possible relief is on the horizon.”
Despite what appears to be price stabilization, AAA continues to believe the national average price of gas could rise by 20 cents per gallon during the spring as refinery maintenance season continues ahead of the changeover to summer blended fuel, however, gas prices remain cheaper than in recent years. The good news is that most U.S. drivers should still pay less than $3 per gallon to fill up their cars this year.
CURRENT AND PAST GAS PRICE AVERAGES
Regular Unleaded Gasoline (*indicates record high)
| 3/15/15 | Week Ago3/8/15 | Year Ago3/15/14 | |
| National | $2.43 | $2.45 | $3.52 |
| Virginia | $2.27 | $2.29 | $3.28 |
| Charlottesville | $2.27 | $2.29 | $3.24 |
| Norfolk Area | $2.30 | $2.34 | $3.30 |
| Richmond | $2.25 | $2.29 | $3.26 |
| Roanoke | $2.21 | $2.21 | $3.23 |
| Crude Oil | $44.84per barrel
(Friday 3/13/15 close) |
$49.61per barrel
(Friday 3/6/15 close) |
$98.20per barrel
(3/13/14) |
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Chris Graham
