The war in Ukraine and fear of less Russian oil entering the market caused the price of crude to creep back above $100 a barrel
Washington, D.C.—The slide in gas prices slowed over concerns about increased global oil prices and the return of seasonal domestic gas demands. The war in Ukraine and fear of less Russian oil in the market caused the price of crude to creep above $100 a barrel. Meanwhile, as more places in the U.S. see pump prices fall below $4 a gallon, demand is ticking back up. Domestically, the national average for a gallon of gas has fallen to $4.08.
“As the days get longer, the weather gets warmer, and pump prices dip from their record highs, consumers feel more confident about hitting the road,” said Andrew Gross, AAA spokesperson. “But these lower pump prices could be temporary if the global price of oil increases due to constrained supply.”
According to new data from the Energy Information Administration (EIA), total domestic gasoline stocks decreased by 3.5 million bbl to 233.1 million bbl last week. Gasoline demand increased slightly from 8.5 million b/d to 8.73 million b/d. Although supply and demand factors would have typically supported elevated pump prices, the fluctuating oil price continues to be the main factor influencing prices at the pump. Pump prices will likely face downward pressure if oil prices remain near $100 per barrel.
Today’s national average for a gallon of gas is $4.08, which is 19 cents less than a month ago, and $1.21 more than a year ago.
The nation’s top 10 most significant weekly decreases: Ohio (−7 cents), Delaware (−7 cents), Florida (−6 cents), Indiana (−6 cents), California (−5 cents), Georgia (−5 cents), Pennsylvania (−5 cents), Kentucky (−4 cents), Virginia (−4 cents) and West Virginia (−4 cents).
The nation’s top 10 least expensive markets: Kansas ($3.66), Missouri ($3.66), Arkansas ($3.69), Georgia ($3.70), Oklahoma ($3.71), Texas ($3.71), South Carolina ($3.74), Mississippi ($3.77), Ohio ($3.77) and Iowa ($3.78).
Oil Market Dynamics
At the close of Thursday’s formal trading session, WTI increased by $2.70 to settle at $106.95. According to EIA’s weekly report, U.S. commercial crude oil inventories increased by 9.4 million barrels from the previous week to 421.8 million barrels. Despite reports of increased inventory, crude oil prices jumped last week as the European Union announced they are drafting plans to ban Russian oil imports, which could tighten global supply as member countries look for new sources for crude oil in an already tight market. Additionally, the most recent Oil Market Report from the International Energy Agency (IEA) forecasts that Russian oil output will shrink by about 1.5 million barrels per day this month due to financial and export sanctions. The crude oil market will likely remain volatile this week and could continue to fluctuate if concerns about supply persist.