Gas Prices Remain Stable Despite Record Low Demand
Feb. 6, 2017 - The national average price of regular unleaded gasoline remained relatively stable over the past week, settling at today’s price of $2.27 per gallon. Although today’s average remains flat compared to one week ago, drivers are paying ten cents less per gallon month-over-month, and 52 cents more per gallon year-over-year. Pump prices have been pressured higher overall due to cuts in oil production globally, but increased U.S. production and low demand has led to a leveling out of prices over the last couple of weeks. The U.S. Energy Information Administration’s (EIA) latest weekly estimates of U.S. gasoline demand show 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.
Current Price Averages per Gallon of Regular Gasoline
- Sioux Falls – $2.24, down 10 cents since 1/6/17 … up 72 cents since 2/6/16
- Rapid City – $2.33, up 13 cents since 1/6/17 … up 46 cents since 2/6/16
- South Dakota – $2.32, down 2 cents since 1/6/17 … up 59 cents since 2/6/16
- U.S. – $2.27, down 9 cents since 1/6/17 … up 52 cents since 2/6/16
The nation’s top five most expense markets are: Hawaii (3.11), California ($2.83), Washington ($2.73), Alaska ($2.72) and the District of Colombia ($2.55).
The nation’s top five least expensive markets are: South Carolina ($2.03), Alabama ($2.06), Tennessee ($2.06), Ohio ($2.07) and Mississippi ($2.07).
The top five markets with the most dramatic year-over-year increases in gas prices include: Minnesota (+71 cents), Michigan (+68 cents), New Jersey (+67 cents), Illinois (+67 cents) and Kansas (+66 cents).
Great Lakes and Central States
As is often the case, volatility has characterized pump prices in the Great Lakes region over the past few weeks. Many states in the region reflected double-digit decreases three weeks ago, only to see gains over the past seven days, led by Indiana (+5 cents), Ohio (+5 cents), Michigan (+4 cents) and Kentucky (+3 cents).
The latest EIA report shows that Midwest gasoline stocks increased by nearly 3.5 million bbl to a total of almost 60 million bbl last week - the fifth consecutive weekly build and a clear sign of low regional demand.
Oil Market Dynamics
Markets opened Monday morning with slightly higher oil prices following new U.S. sanctions imposed on Iran after its missile tests. Worries that tensions between the U.S. and Iran could impact crude oil supplies have been tempered by increasing U.S. oil production. Baker Hughes, an oil field services company, reported that U.S. energy companies added 17 oil rigs the week of February 3, bringing the total U.S. rig count to 583. 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. Traders will keep an eye of U.S.-Iran relations and any further gains in U.S. oil production. At the closing of Friday’s formal trading session on the NYMEX, WTI was up 29 cents to settle at $53.83 per barrel.
Motorists can find current gas prices along their route with the free AAA Mobile app for iPhone, iPad and Android. The app can also be used to map a route, find discounts, book a hotel and access AAA roadside assistance. Learn more at AAA.com/mobile.
AAA is North America’s largest motoring, leisure travel and safety advocacy organization with more than 56 million members. A not-for-profit, fully tax-paying organization, AAA South Dakota provides its nearly 96,900 South Dakota members with emergency roadside assistance and auto travel services. Plus, the auto club offers members and the general public a wide range of personal insurance, worldwide travel and financial services at branch offices across South Dakota and online at AAA.com.
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