Gas prices remain well under $2 a gallon

National average gas prices have now spent 37 consecutive days below the $2 per gallon benchmark.

The combination of seasonal reductions in gasoline demand and the relatively lower price for crude oil are likely to help keep prices low in the near term.  Today’s national average price of $1.74 per gallon is discounted by six cents per gallon on the week, 26 cents per gallon on the month and 43 cents per gallon on the year.

Retail averages typically fall during the winter months, due to reduced driving demand. In addition, pump prices slid sharply in the final months of 2015, causing the magnitude of the yearly savings to narrow.

At the close of Friday’s formal trading on the NYMEX, WTI was down $2.73 to settle at $30.89 per barrel. Crude stocks topped 500 million barrels for the first time ever earlier in the week as market fundamentals continue to point to supply outpacing demand. However, crude oil prices have been subject to some speculation about when and if prices have reached their bottom. The impact of the removal of the decades old crude oil export ban is also a question in regard to production and global oil supply.

“The imbalance between supply and demand and the resolution of distribution and refinery issues is contributing to falling prices at the pump,” said Martha Meade, Manager of Public and Government Affairs for AAA Mid-Atlantic.  “Barring any major supply or distribution issues, and if the price of crude remains depressed, prices at the pump remain poised to continue lower heading into the spring maintenance season.”

Though the price of crude has fluctuated over the past week, daily price reductions at the pump are slowing down, suggesting that prices will soon be impacted by increased costs at refineries as they shut units for maintenance and begin producing the more expensive summer blend of gasoline. Although the summer blend is not required to be sold until May 1, refineries typically begin making it at least a month ahead to build up supply, while tapering off production of the winter blend.

 

CURRENT AND PAST GAS PRICE AVERAGES

Regular Unleaded Gasoline (*indicates record high)

	Today 2/7/16	Week Ago 1/31/16	Year Ago 2/7/16
National	$1.74	$1.80	$2.17
Virginia	$1.62	$1.66	$2.07
Charlottesville	$1.64	$1.70	$2.05
Norfolk Area	$1.57	$1.59	$2.14
Richmond	$1.57	$1.61	$2.05
Roanoke	$1.64	$1.69	$2.03
Crude Oil	$30.89 per barrel (Friday 2/5/16 close)	$33.62 per barrel (Friday 1/29/16 close)	$61.63 per barrel (2/6/15)