Public Affairs Specialist, OH
O: (513) 762-3105 ext. (5503105)
C: (513) 401-4911
CINCINNATI, Oh. (June 17, 2019)— Gas prices dropped by four cents or more across most of the Great Lakes and Central States region, with Michigan (-12 cents), Illinois (-9 cents), Oklahoma (-9 cents) and Ohio (-7 cents) landing on the list of top 10 largest weekly declines.
Compared to last month, all motorists in the Great Lakes and Central states are seeing a cost savings at the pump. The states seeing the largest drops are: Ohio (-29 cents), Michigan (-28 cents), Indiana (-26 cents), Kentucky (-21 cents), Illinois (-20 cents), Tennessee (-19 cents) and Oklahoma (-19 cents).
On the week, regional gasoline inventories built by 200,000 bbl to register at 48.3 million bbl. Refinery production has also been strong in the region, with operating rates increasing 4% on the week to reach a total of 88%.
Tri-State Weekly Average Gas Prices
|Week Ago Average||$2.564||$2.539||$2.706|
|Month Ago Average||$2.784||$2.694||$2.904|
|Year Ago Average||$2.703||$2.773||$2.918|
National Gas Price Outlook
The national average dropped six cents on the week, following a consistent downward trend since Memorial Day. The decline is unusual for this time of year. Pump prices usually trickle higher during the summer months due to increased demand.
However, the latest Energy Information Administration (EIA) report reveals that total domestic gasoline inventories jumped a million bbl last week, helping to push pump prices lower. According to OPIS, strong production output and increased imports have helped gasoline storage levels grow consistently over the past four weeks.
“Growing gasoline inventories are contributing to relief at the pump as we head into summer,” said Jenifer Moore, AAA spokeswoman. “Current U.S. inventories sit at nearly 235 million bbl, which is helping to feed growing demand.”
According to the latest EIA report, gasoline demand reached 9.877 million b/d last week - the 6th highest weekly count on record. Current demand levels are on par with volumes seen this same time last year (9.879 million b/d). Today’s national average is $2.68, which is six cents cheaper than last week, 17 cents less than last month and 20 cents less than the same time last year.
The nation’s top 10 largest monthly decreases are: Ohio (-29 cents), Michigan (-28 cents), Indiana (-26 cents), California (-23 cents), Mississippi (-21 cents), Kentucky (-21 cents), Illinois (-21 cents), Tennessee (-19 cents), North Carolina (-19 cents) and Oklahoma (-19 cents).
The nation’s top 10 most expensive markets are: California ($3.81), Hawaii ($3.64), Washington ($3.41), Nevada ($3.41), Alaska ($3.38), Oregon ($3.28), Idaho ($3.10), Utah ($3.09), Arizona ($2.97) and New York ($2.86).
Oil Market Dynamics
At the close of Friday’s formal trading session on the NYMEX, WTI increased by 23 cents to settle at $52.51. Crude prices increased late last week as a result of an attack on two tankers in the Gulf of Oman. This attack heightened market fears that rising tensions could continue in the Middle East and negatively impact crude oil availability. Approximately 20% of global crude supplies flow through the waterway. The Trump Administration attributed the attack to Iran, however, the country denies the accusation. If tensions between the U.S. and Iran escalate, the market will likely continue pushing global crude prices higher.
Before market fears increased, the price of crude hit its lowest point in six months last week. The drop in crude oil prices was supported by EIA revealing that total domestic crude inventories grew again by 2.2 million bbl and now sit at 485.5 million bbl. The current level is 53 million bbl higher than last year’s level at this time. An oversupply of crude has increased concerns that the market has a glut of oil – even as U.S.-imposed sanctions on Iran and Venezuela have worked to reduce global supply. Moreover, the Organization of the Petroleum Exporting Countries (OPEC) reduced their global oil demand outlook for the remainder of 2019 to 1.14 million b/d – down 70,000 barrels b/d from OPEC’s previous demand forecast due to reduced global trade as a result of tensions between the U.S., China, and Mexico. At its upcoming meeting on June 25-26, the cartel and its partners are expected to extend the current agreement to cut production by 1.2 million barrels per day through the end of 2019. Reduced global supply, amid robust demand, could increase crude prices in the latter half of the year.
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 members can also find additional savings by signing up for the Shell Fuel Rewards Program. Members can sign up for free and save five cents per gallon at participating Shell stations.
AAA provides automotive, travel, and insurance services to 59 million members nationwide and nearly two and a half million members in Ohio. AAA advocates for the safety and mobility of its members and has been committed to outstanding road service for more than 100 years. AAA is a non-stock, non-profit corporation working on behalf of motorists, who can now map a route, find local gas prices, discover discounts, book a hotel, and track their roadside assistance service with the AAA Mobile app (AAA.com/mobile) for iPhone, iPad and Android. For more information, visit www.AAA.com.