The kickoff of the summer driving season has drivers paying the lowest gas prices for this time of year in more than a decade, as gas prices for the Memorial Day holiday were the cheapest since 2005 and were down 42 cents per gallon versus last year’s holiday.
Today’s average price of $2.36 per gallon represents an increase of four cents per gallon on the week, and 14 cents more per gallon on the month. For the first time in 36 weeks the retail cost of gasoline is above $2 a gallon in all regions of the USA.
“The summer driving season is off and running with gas prices at 11-year lows,” said Martha Meade, Manager of Public and Government Affairs for AAA Mid-Atlantic. “Lower prices at the pump have contributed to the largest year-over-year growth in vehicle miles traveled in the Northeast. This growth in demand appears to be offset by the region’s abundant supply, which should help keep a lid on prices as we enter the busy summer driving season.”
According to the U.S. Energy Information Administration (EIA), implied gasoline demand hit nearly 9.4 million barrels per day in March, the highest ever level for the month, and the highest since August 2015.
At the close of Friday’s formal trading session on the NYMEX, West Texas Intermediate (WTI) crude oil was down 72 cents per barrel on the week to settle at $48.62 Crude oil is reportedly gaining strength on a weakening U.S. dollar which makes oil less expensive for countries holding other currencies. Over the past week both global crude oil benchmarks, Brent and WTI, exceeded the $50 per barrel threshold due to expectations of tightening supply.
A wildcard for gas prices in the coming months is the Atlantic Hurricane Season, which runs from June 1 – November 30. According to the National Oceanic and Atmospheric Administration’s Climate Prediction Center, this year’s season will likely be near normal, which means of the 10-16 named storms, four to eight could become hurricanes. Should any of these severe storms or hurricanes reach landfall, production, refining and distribution could be impacted. This can lead price spikes in regional markets along the coast and in areas that rely upon crude oil and refined product from these regions.
More from AAA
AAA’s Fuel Gauge Report website is sporting a brand new look! The website presents detailed gasoline and diesel price averages, archived gas price data, options to receive free gas price updates via your smartphone or laptop and access to AAA’s Gas Cost Calculator. The resources are formatted in a more user-friendly and graphically pleasing format. Find it at its new URL: http://GasPrices.AAA.com