Pump prices continue to tumble as fears of a possible COVID-19 global economic slowdown pushed oil prices into the mid $60s per barrel—a price not seen since August. Also helping to ease upward pricing pressure was the decision by OPEC and its oil-producing allies not to cut production. The national average for a gallon of gas dipped 4 cents on the week to $3.35. For consumers, gasoline prices were last this low on October 20.
“Consumers may be catching a break at the pump right now, but it’s not for a very good reason,” said Andrew Gross, AAA spokesperson. “A potential COVID-19 induced economic slowdown hurts everyone and could prompt OPEC to slash production if oil prices drop too low.”
On December 2, OPEC and its allies, a group referred to as OPEC+, announced it would stick to its plan, for now, to raise production by 400,000 b/d in January. The move was likely in response to the Biden Administration’s call to increase supply to tame high fuel prices.
According to new data from the Energy Information Administration (EIA), total domestic gasoline stocks increased by more than 4 million bbl to 215,422 million bbl last week. Meanwhile, gasoline demand dipped from 9.3 million b/d to 8.8 million b/d. The slight decrease in demand contributed to falling prices, while lower crude prices also put downward market pressure on pump prices.
Today’s national average of $3.35 is seven cents less than a month ago and $1.19 more than a year ago.
The nation’s top 10 largest monthly decreases: Indiana (−21 cents), Michigan (−18 cents), Ohio (−17 cents), Washington, D.C. (−15 cents), Missouri (−14 cents), Texas (−13 cents), Iowa (−13 cents), Kansas (−12 cents), Oklahoma (−12 cents), and South Carolina (−12 cents).
The nation’s top 10 most expensive markets: California ($4.68), Hawaii ($4.34), Nevada ($3.91), Washington ($3.87), Oregon ($3.78), Arizona ($3.77), Alaska ($3.71), Idaho ($3.65), Utah ($3.62) and Pennsylvania ($3.57).
According to experts, some relief at the pump is headed for Arizona drivers. After seeing near-record prices and some of the highest increases in the country, experts say prices should soon be coming down.
According to AAA, the average price of gas in Arizona is $3.78/gallon with some stations well above that at $4.25. Nationally, the average is $3.35/gallon.
This recent gas price surge put Arizona prices in line with California prices, because refinery issues in California caused a supply shortage here.
Experts detail that often when there are refinery kinks, Arizona lies at the end of two pipelines that creates unique issues. Arizona also has its own blend of gasoline. So, if there’s a refinery issue in California it can have a ripple effect not only on California’s gas prices but Arizona’s as well.