Gas prices, fueled by higher oil prices, on the rise despite drop in consumer demand

Higher oil prices have fueled a mini-surge in gas prices since the July 4 holiday, with the average price nationally up three cents since Monday, hitting the $3.55 per gallon mark, according to AAA.

Oil is trading at $75 per barrel, up more than five dollars per barrel over the past week, which is pushing prices at the pump upward even with gas demand down nearly 10 percent since the July 4 holiday.

“Typically, this would lower gas prices, but such a move is being countered for now by the increasing cost for oil, the main ingredient in gasoline,” said Morgan Dean, a spokesperson at AAA.

According to new data from the Energy Information Administration (EIA), gas demand decreased significantly from 9.6 to 8.76 million b/d last week. Meanwhile, total domestic gasoline stocks stayed flat at 219.5 million bbl. Although lower gas demand typically pushes pump prices lower, rising oil prices have lifted them. If oil prices continue to rise, pump prices will likely follow suit.

Today’s national average of $3.55 is three cents more than a month ago, but still $1.08 less than a year ago.

Virginia’s gas average today ($3.35) is up four cents in the past week, up three cents in the past month, but $1.06 less than on this day a year ago.