Gas prices continue to slide as 29.7 million Americans prepare to make their last road trip of the summer during the upcoming Labor Day holiday weekend. The national average price for regular unleaded gasoline dropped to $3.44 per gallonSunday, down three cents from last week, 13 cents lower than one month ago, and 9 cents lower than year ago prices. The national average has fallen 24 cents per gallon since the official start of summer on June 21.
Crude oil prices continued to trade below the $100 per barrel mark this week, a trend that began July 31. Crude oil has traded below $100 for 17 straight closings through Friday, August 22.
Geopolitical tensions remain at the forefront as the situations in Russia, Ukraine and Iraq continue to make headlines. However, concerns of supply disruptions have been largely dismissed as global oil prices continue to slide due to the relative stability of global supply projections. The U.S. is approaching its highest annual level of oil production since 1972 and Libya is returning to previous production levels.
The Energy Information Administration (EIA) noted in its weekly report that U.S. crude oil inventories decreased 1.4 million barrels to 362.5 million barrels. Gasoline stocks increase by 0.6 million barrels to 213.3 million barrels. Implied demand for the week ending August 15 came in at 8.775 million barrels per day (bpd), a drop of 147,000 bpd from the previous week. The four-week average is still just above 9 million bpd at 9.016 million bpd, running behind last year’s average of 9.196.
“Consumers continue to find falling gas prices at the local gas station typically because crude oil is trading below $100 per barrel,” said Martha M. Meade, Manager of Public and Government Affairs for AAA Mid-Atlantic. “Gas prices are likely to remain relatively low as travelers get ready to jump in the car for the upcoming Labor Day weekend.”
AAA Travel projects 34.7 million Americans will journey 50 miles or more from home during the Labor Day holiday weekend, the highest volume for the holiday since 2008 and a 1.3 percent increase over 2013. Nearly 86 percent of travelers (29.7 million) will celebrate the holiday with a final road trip before summer comes to a close and children head back to school. Travelers are encouraged, in part, by the lowest gasoline prices for Labor Day in four years or since 2010.
Barring a major development, such as a Gulf Coast hurricane, prices are likely to remain relatively low leading up to the holiday weekend compared to recent years, which will allow travelers to allocate more of their budgets towards travel expenses.
CURRENT AND PAST GAS PRICE AVERAGES
Regular Unleaded Gasoline (*indicates record high)
| 8/24/14 | Week Ago
8/17/2014 |
Year Ago
|
|
| National | $3.44 | $3.46 | $3.54 |
| Virginia | $3.20 | $3.23 | $3.36 |
| Charlottesville | $3.13 | $3.14 | $3.24 |
| Norfolk Area | $3.25 | $3.30 | $3.41 |
| Richmond | $3.13 | $3.16 | $3.33 |
| Roanoke | $3.09 | $3.13 | $3.23 |
| Crude Oil | $93.65
per barrel (at Friday’sclose, 8/22/14) |
$97.35
per barrel (at Friday’sclose, 8/15/14) |
$105.03
per barrel (8/22/2013) |
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Chris Graham
