BOSTON (Mar. 20) – At a time of year motorists typically see gasoline prices rise, they’ve fallen for the second straight week nationally, edging lower by a penny to $2.29 per gallon according to price-tracker GasBuddy.com which supplies data for wane.com’s Gas Gauge.
The rise in gasoline prices since February 15 has been the weakest since 2009, when prices fell due as the country was reeling from the recession. Gasoline prices between February 15 and March 20, 2009 fell a cent, while they rose 29 cents in 2016 during the same time period. The record rise between the two dates occurred in 2011 when motorists saw a 43 cent per gallon spike.
According to GasBuddy, the weak showing for gasoline prices this year is thanks to a better balanced oil market: while OPEC cut oil production last November, U.S. oil producers have been incentivized to return to the market with higher oil prices and are offsetting much of the loss from OPEC countries. The number of producing rigs in the United States has risen consistently since OPEC’s cuts and stands at 789, up 313 (66%) versus a year ago, rising 21 rigs in the last week alone. In Canada, rig counts have blossomed as well, where 207 (300%) more rigs are online versus a year ago. As a result, oil production in both countries is up, leading oil prices to see weakness, which trickles down to gasoline prices.
Average gasoline prices fell in 32 states last week while rising in 18. The largest decliners were Iowa (3.6 cents), Oklahoma (2.8 cents), Kansas (2.7 cents), South Carolina (2.6 cents) and Wisconsin (2.6 cents). Seeing the biggest gains: Ohio (6.5 cents), Indiana (6.3 cents), Utah (3.6 cents), Illinois (2.5 cents) and Michigan (2.3 cents). The number of stations selling gasoline under $2 per gallon rose to 10.9% today, up from 9.4% a week ago, while notably higher than a year ago (76.1%).
Still, every state today is seeing gasoline prices higher than a year ago. The biggest year-on-year rise is in Utah, where average prices today stand 61 cents higher than a year ago. Following, are Washington (60 cents), Alaska (58 cents), Idaho (55 cents) and New Jersey (55 cents).
While refinery maintenance season and the transition to summer gasoline come closer to completion, lower oil prices are making a dent on GasBuddy’s January forecast that gasoline prices could rise 35-70 cents between a low in February and high in May. While the recent issues plaguing oil could shift again, it’s looking likely that the spring rally could be cut in half, keeping billions in the wallets of motorists traveling this summer.