Year-End Pump Prices to be Most Expensive Since 2014
Omaha, NE (November 27, 2017) – This December motorists will not find significant holiday savings at the gas pump. Today’s national gas price average is $2.51, which is 38 cents more than this time last year. While AAA does expect gas prices to decline between now and the end of the year, motorists will still pay the highest November and December gas prices since 2014.
“Despite a forecasted 5 to 20 cents decrease in coming weeks, motorists will see higher than expected December gas prices - especially compared to year-end prices from 2015 and 2016,” said Jeanette Casselano, AAA spokesperson. “Driving factors for cheaper gas prices this winter include colder temperatures, the threat of inclement weather and online shopping.”
In 2017, gas prices have strayed from typical trends. Historically, year-end gas prices tend to be relatively cheap due to a drop-off in fall gasoline demand around Labor Day and the move to cheaper to produce winter-blend gasoline in mid-September. This year, the typical factors that drive gas prices down in winter were outweighed by the impact of two major hurricanes, steady consumer demand and continued growth in gasoline exports.
2017’s Tumultuous Trends
- Highs and Lows: Summer driving season traditionally brings the highest gas prices of the year and year-end brings the lowest, but not this year:
- 2017 High: $2.67 on September 11
- 2017 Low: $2.23 on July 5
- Exports: According to the Energy Information Administration (EIA), in the first half of 2017 U.S. exports of total motor gasoline averaged a record high of 756,000 b/d, a three percent increase from the first half of 2016. The second half of 2017 has seen this trend continue to climb, with exports peaking to one of their highest points in 2017 – 906,000 b/d – last month.
- Production: According to Baker Hughes, Inc., the total oil rig count is currently 747, which is 273 more rigs than last year’s count at this time.
- REGIONAL OUTLOOKS
- West Coast: This region is home to the most expensive markets in the country. The crude refinery utilization rate in the region has grown to nearly 88 percent this autumn, after lower rates earlier in the season placed greater strain on supplies in the face of strong demand as evidenced by high year-to-date averages: Hawaii ($3.09), California ($3.00), Alaska ($2.88), Washington ($2.86), Oregon ($2.71), Nevada ($2.66) and Arizona (2.28). Gas can be found for $3.01 or more in all seven states in the region, though at just one percent of gas stations in Arizona, five percent in Oregon and six percent in Nevada. The good news is AAA expects the West Coast to see gas prices drop the most in the month ahead.
- Great Lakes and Central States: High refinery maintenance this fall has led to higher gas prices and tightened supply, leaving a typically volatile area even more susceptible to sudden price shocks. With gasoline stocks sitting just above 45 million bbl – 3 million bbl below last year’s level at this time – further unscheduled refinery maintenance and the shutdown of the Keystone pipeline could cause a spike in prices.
On average, motorists in Michigan ($2.44), Illinois ($2.43), South Dakota (2.38), Wisconsin ($2.35) and Nebraska (2.35) have seen the highest gas prices in the region this year; while Missouri ($2.17), Kansas ($2.23), Ohio ($2.29), Kentucky ($2.29) Indiana ($2.32) and Minnesota ($2.32) have seen the lowest gas price averages in the region. Currently, gas can be found for $2.25 or less at the following percentages of gas stations: Missouri (36%), Kentucky (26%), South Dakota (9%), Kansas (5%), Ohio (5%), Michigan (3%) and North Dakota (2%). While Iowa, Minnesota, Nebraska, Illinois, Indiana and Wisconsin gas stations are selling gas for 2.25 or less, it is at less than one percent of stations.
- Mid-Atlantic and Northeast: Many motorists in this region have seen sizeable price increases at the pump during November, as current gasoline inventories were sitting at their lowest inventory points for this time of year since 2014. The increases were likely due to a lack of gasoline imports that has contributed to tighter than usual supply in the region. However, pump prices in the last week have started to decline and will continue to drop, especially if imports move into the region.
There is a 44-cent price difference between the highest and lowest gas price average year-to-date in the region with Pennsylvania ($2.61) topping the charts and Tennessee ($2.17) rounding out the list. Only six states have the majority of gas stations selling gas for $2.50 or less: North Carolina (96%), Delaware (96%), Tennessee (94%), Virginia (94%), Maryland (71%) and New Hampshire (53%).
- South and Southeast: The direct impacts to gasoline production and delivery from the active hurricane season were felt hardest in this region, with nearly a quarter of the U.S. refining capacity shut down during some points of late summer and early fall. Refining capacity has been slowly recovering in the region, increasing production by more than 100,000 barrels per day in the weeks following the storms.
Florida ($2.37) leads the region with the most expensive year-to-date average. New Mexico ($2.30), Georgia ($2.29), Texas ($2.19) and Louisiana ($2.18) round out the top five highest year-to-date gas price averages in the region. South Carolina ($2.12), Alabama ($2.14), Mississippi ($2.15), Oklahoma ($2.15) and Arkansas ($2.15) have the cheapest averages in the region and the country for the year.
- Rockies: During the region’s summer tourism season, gasoline retail prices skew their highest and drop when winter approaches. This year was no different. In October, gasoline inventories in the area reached their highest point since the end of June at just over 7 million bbl. The current total level is lower than last year’s amount at this time, making the region vulnerable to higher gas prices this winter. If demand falls, as expected in the region, prices are likely to drop.
- Year-to-date averages: Idaho ($2.56), Utah ($2.46), Montana ($2.42), Wyoming ($2.35) and Colorado ($2.34). The vast majority of gas stations in Montana (94%) and Idaho (84%) are selling gas for $2.51 or more; whereas gas can be found for $2.50 or less at the majority of stations in Colorado (56%), Wyoming (63%) and Utah (71%).
- 2018 Look Ahead:
Motorists can expect gas prices to continue to trend cheaper the first few months of 2018, with potential to see the national gas price average in the $2.25-$2.35 range by February. OPEC’s November 30, 2017 meeting and any decisions to further cut or keep production rates stable will influence longer-term forecasts for 2018.
New Tools and Enhancement Unveiled at GasPrices.AAA.com
In time for year-end road trip planning, AAA has added new tools to GasPrices.AAA.com to provide more comprehensive gas price data and insight to motorists and journalists.
In addition to the daily national gas price average for regular, mid-grade, premium and diesel gas, AAA now provides the daily E-85 national average.
Enhanced features to the Top Trends page allows visitors to sort data in various ways (high to low pricing, by date) and easily identify changes by directional colored arrows: increases (red); decreases (green); or no change (grey). Lastly, the top trends page now offers the ability to query gas prices at the state metro level.
With the addition of 175 new metropolitan areas and corresponding gas prices, state coverage is more comprehensive. In addition, each state now touts county gas price averages via a state heat map.
A new ‘State Gas Price Averages’ page provides an overview of each state’s daily gas price for regular, mid-grade, premium and diesel fuel. From this page, a visitor can also click on a state name and be taken directly to that state’s landing page. Users can sort data on this page alphabetically by state name or highest/lowest price by fuel grade.
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.