Jun 20, 2016 | Fuel
By Nadia Anderson
Manager, AAA Federal Relations
Monday, June 20, 2016
Gas prices have fallen for nine consecutive days, reaching today’s average national price of $2.33 per gallon. Gasoline demand remains on track to set a new all-time high for the 2016 summer driving season, however, crude oil remains relatively less expensive than recent years which is contributing to direct savings at the pump. Drivers are saving a nickel per gallon on the week, but are paying five cents per gallon more on the month. Averages are down 46 cents per gallon versus this same date last year, attributed year-over-year surpluses, and these savings are likely to continue as supply appears more than capable of keeping pace with growing demand.
Pump prices generally peak during the summer months, due to imbalances in supply and demand. Unlike many recent years, supply appears to be meeting the growing demand and as a result prices have held relatively steady and markedly lower than one year ago. On the whole, refineries are keeping up with growing demand and the latest data from the U.S. EIA shows that the market is well supplied. Additionally, expectations of increased production from Western Canada and the U.S. are likely to keep global crude oil prices relatively lower. The combination of the abovementioned factors is contributing to prices at the pump remaining at some of their lowest levels since 2005, and these comparative savings should persist, barring and major disruptions in production or supply.
Locally, South Jersey motorists are paying an average of $2.05 per gallon of unleaded gas. This is a decrease of 3 cents per gallon compared to both last week’s and last month’s price ($2.08). Today’s price is also 51 cents per gallon less than one year ago today ($2.51).
Quick Stats
Mid-Atlantic and Northeast
Despite being home to one of the nation’s top 10 most expensive markets—Washington, D.C. ($2.54)—on the whole, gas prices in the region are relatively moderate and remain below the $2.50 per gallon benchmark.
Gas prices are down in every state in the Northeast on the week, with the largest weekly savings experienced by drivers in Delaware (-5 cents), Maryland (-3 cents), Maine (-3 cents) and New Jersey (-3 cents). Consumers in the region are also benefitting from noticeable year-over-year savings, with averages down by more than 50 cents per gallon in Delaware (-56 cents), New York (-52 cents), Connecticut (-51 cents) and New Jersey (-51 cents). Total gasoline inventories in the region are reportedly healthy and pump prices should remain relatively steady in the region during this year’s summer driving season.
Oil Market Dynamics
Crude oil prices continue to swing on speculations of increased production and market dynamics related to the geopolitical issues. Both primary global benchmarks, West Texas Intermediate and Brent Crude, opened the week with gains credited to questions surrounding whether the U.K will exit the European Union, and what, if any impact it will have on the global oil market and the U.S. dollar. A vote is scheduled for later this week. News about U.S. gasoline demand and the U.S. dollar are also expected to influence crude oil prices in the near term – both factors tend to lead to fluctuations in the price drivers pay at the pump.
After reaching its lowest settlement price since May 13 earlier in the week, WTI closed out Friday’s formal trading session on the NYMEX, up $1.77 to settle at $47.98 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.