March Madness is here, however things are anything but mad at the gas pumps so far this spring. Prices continue to ease for motorists as crude oil prices stabilize and refineries come back online following winter maintenance. The national average price of regular grade gasoline dropped a penny this week to $3.69 Friday. This price is eight cents more than one month ago, but it is 19 cents less expensive than the average price one year ago.
Monday (3/18) was the first day since January 11 that the average price at the pump has registered a month-over-month decline. The national average has fallen 19 of 23 days since the peak 2013 price to date of $3.79 on Feb. 27.
Crude oil started the week on a brief upswing to cross above the $95 per barrel mark, however by week’s end oil prices retreated as demand outlook concerns as Cyprus struggles to raise money to qualify for a bailout. The European Union has given Cyprus until Monday to raise billions of euros to receive an international bailout to avoid a bank collapse and likely exit from the euro currency zone. Cyprus only added to the euro zone’s already unstable economic outlook and dismal demand outlook in March. Countering euro zone troubles has been positive economic data from the U.S. Existing home sales and leading economic indicators rose last month, and although the number of Americans filing new unemployment claims edged slightly higher last week, overall claims remain at the lowest level in five years. Crude oil settled at $93.71 Friday, up 26 cents for the week.
In its weekly report, the Energy Information Administration (EIA) data showed crude oil stocks dropped (for the first time in nine weeks) 1.3 million barrels to 382.7 million barrels, compared to analysts’ expectations for a rise of 2 million barrels. Gasoline stocks fell 1.5 million barrels to 222.8 million barrels, below an expected decline of 2.1 million barrels. Total motor gasoline supplied averaged slightly more than 8.5 million barrels a day over the past four weeks. That is a rise of about 1.5% compared with the same period a year ago. The EIA also reported monthly crude oil production in the United States is expected to exceed the amount of U.S. crude oil imports later this year for the first time since February 1995.
“Lucky for motorists the only madness this weekend will be on basketball courts across the country and not at the gas pump,” said Martha M. Meade, Manager of Public and Government Affairs for AAA Mid-Atlantic. “Gas prices have declined steadily since reaching 2013 peaks at the end of last month. In fact, analysts believe that in the short term we are looking at lower prices, perhaps as much as 20 cents a gallon or more below 2012 prices in the coming weeks.”
Gas prices are likely to continue sliding into spring following earlier-than-usual late winter peak prices the last week in February. Some areas, especially in the Mid-Atlantic and New England parts of the country, may see brief increases as fuel in these parts begins to change over to the more expensive summer blended gasoline. Then prices will taper off and likely retreat throughout the summer months.
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