Gas prices holding steady: AAA

Gas prices across the Mid-Atlantic continue to sing the same old song – a favorite on drivers’ playlists.

Averages have stayed relatively stable and in some regions, decreased a few pennies during the week. The national average price of regular unleaded gasoline follows the Mid-Atlantic trend, settling at today’s price of $2.28 per gallon, a penny lower than one week ago, eight cents less per gallon month-over-month, and 58 cents more per gallon year-over-year.

“The increase in U.S. domestic oil production has helped to counter-balance OPEC’s production cuts, sending gas prices down slowly,” said Tammy Arnette, Senior Public Affairs Specialist for  AAA Mid-Atlantic. “As refiners slowly use up all of their cheaper winter-blend gasoline, summer-blend gas will take its place, likely bringing the decline in prices we’ve seen to an end.”

While pump prices had been pressured higher kicking off 2017 due to cuts in oil production globally, increased U.S. production and low demand have led to a leveling out of prices over the last few weeks. The U.S. Energy Information Administration’s (EIA) latest weekly estimates of U.S. gasoline demand shows that January 2017 figures are down 6 percent from January 2016 and are at their lowest standing for the first month of the year since 2012.

At the closing of Friday’s formal trading session on the NYMEX, WTI was up three cents to settle at $53.86 per barrel, but $12.89 above one year ago. The potential for more U.S. oil production has kept a ceiling on oil prices and diminished the impact of efforts by OPEC and non-OPEC countries to cut production and rebalance global oil supply. Tuesday, the American Petroleum Institute reported the second-largest weekly inventory build ever in the history of records, at 14.227 million barrels, versus expectations of a 2.38-million-barrel increase.

The Energy Information Administration (EIA) forecasts U.S. regular gasoline retail prices to average $2.39 per gallon in 2017 and $2.44 per gallon in 2018. The EIA also expects West Texas Intermediate (WTI) crude oil prices to average about $54 per barrel in 2017. U.S. crude oil production averaged an estimated 8.9 million barrels per day (b/d) in 2016. U.S crude oil production is forecast to average 9.0 million b/d in 2017 and 9.5 million b/d in 2018.