Gas prices continue to head downward as nearly 30 million travelers take to the roads to celebrate the last travel holiday of the summer. The national average price for regular unleaded gasoline is $3.44 per gallon as of Friday, equal to last week’s average, 8 cents lower than one month ago, and 12 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 nearly a month ago on July 31. For five consecutive days from August 21-27, the commodity traded in the $93 per barrel range, the lowest level since mid-January. The trend was over Thursday as the cost of crude oil rose nearly one dollar per barrel to $94.55, but still well below $100 per barrel. Thursday’s higher closing price could be attributed to expectations for strong oil demand, as the U.S. government released early morning a revised second quarter gross domestic product (GDP) figure, which showed the economy expanded even more rapidly than previously estimated.
The easing of crude prices has been a driving factor behind falling retail gasoline prices across the nation. Additionally, concerns of supply disruptions due to overseas reports of violence and tension continue to be monitored by analysts, but unseen. 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.
The Energy Information Administration (EIA) noted in its weekly report that U.S. crude oil inventories decreased 2.1 million barrels to 360.5 million barrels. Gasoline stocks decreased by 1 million barrels to 212.3 million barrels. Implied demand for the week ending August 22 came in at 9.1 million barrels per day (bpd), an increase of 325,000 bpd from the previous week. The four-week average is still just above 9 million bpd at 9.039 million bpd, running behind last year’s average of 9.167.
“Consumers are being treated to some of the lowest Labor Day gas prices since 2010 thanks in part to minimal supply disruptions and low crude oil prices,” said Martha M. Meade, Manager of Public and Government Affairs for AAA Mid-Atlantic. “Prices could fall further after September 15 as refineries begin to change over to the less costly to produce winter blend gasoline.”
Consumers may continue to find falling gasoline prices even past the federally-mandated winter blend switchover date ofSeptember 15. Winter blend gasoline is several cents cheaper to produce than summer blend gasoline, which is formulated to limit emissions during the warm summer months.
CURRENT AND PAST GAS PRICE AVERAGES
Regular Unleaded Gasoline (*indicates record high)
| 8/29/14 | Week Ago
8/22/14 |
Year Ago
|
|
| National | $3.44 | $3.44 | $3.56 |
| Virginia | $3.19 | $3.20 | $3.37 |
| Charlottesville | $3.14 | $3.13 | $3.24 |
| Norfolk Area | $3.23 | $3.26 | $3.40 |
| Richmond | $3.12 | $3.13 | $3.34 |
| Roanoke | $3.10 | $3.10 | $3.25 |
| Crude Oil | $94.55
per barrel (atThursday’sclose 8/28/14) |
$93.96
per barrel (at Thursday’sclose, 8/21/14) |
$110.10
per barrel (8/28/13)
|
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Chris Graham
