National Average Ekes Out 11th Straight Weekly Drop as Oil Struggles

For the 11th consecutive week, the nation’s average price of gasoline has fallen, declining 0.4 cents from a week ago to $3.21 per gallon yesterday according to GasBuddy data compiled from more than 12 million individual price reports covering over 150,000 gas stations across the country. The national average is down 18.9 cents from a month ago and 14.9 cents per gallon lower than a year ago. The national average price of diesel has fallen 4.7 cents in the last week and stands at $4.18 per gallon—92 cents lower than one year ago.

“We’ve barely eked out a drop in the national average over the last week, extending the streak to 11 straight weeks of decline, even as some states have seen prices jump, while others have seen prices continue to inch lower. Motorists can blame the OPEC+ meeting for causing oil to jump early last week and then plummet late last week for the volatility in gas prices,” said Patrick De Haan, head of petroleum analysis at GasBuddy. “The good news is that as the dust settled, OPEC+ agreed to barely move the needle, deepening their production cuts by an additional 900,000 barrels per day in 2024, with Saudi Arabia extending their own million barrel per day cut through March. However, that wasn’t enough to offset concerns of falling global demand, which pushed oil back down to below $73 in Sunday night trading, giving hope that the national average still could fall to $2.99/gal by the end of the year.”

OIL PRICES

After rallying early last week ahead of OPEC+’s decision to cut oil production in 2024, the price of oil has again fallen flat on its face as renewed concerns of oversupply flood the market. In early Monday trading, a barrel of West Texas Intermediate crude oil was down 60 cents to $73.47 per barrel, after briefly falling below $73 earlier in the overnight session. Compared to last Monday’s $74.89 in early open trading, WTI was off about $1.50 per barrel. Brent crude oil was down 53 cents in early Monday trading, last seen at $78.37 per barrel, also down over $1 per barrel from last Monday’s $79.95 per barrel fetch. While OPEC did agree to cut production by some 900,000 barrels in 2024 with the Saudis extending their million barrel per day cut through March, some producers, like Angola, openly defied their quota, giving the potential they could leave the cartel, unhappy with their low oil production target, and potentially undermining the agreement.

OIL AND REFINED PRODUCTS

Last week’s report from the Energy Information Administration showed a 1.6 million barrel increase in oil inventories, which now stand over 7% higher than a year ago, and slightly ahead of the five-year average for this time of year. Cushing saw inventories rise by 1.8 million barrels, while the SPR also saw a modest 300,000-barrel rise. Domestic oil production remained at 13.2 million barrels per day. Gasoline inventories gained 1.8 million barrels, while still below the five-year average, are up 2.1% from a year ago, while distillates rose a significant 5.2 million barrels, and stand nearly 2% above a year ago. Implied gasoline demand, a proxy for retail demand, was pegged at 8.21 million barrels per day, slightly weaker than recent GasBuddy findings, estimating demand about 100,000 barrels per day higher. Refinery utilization rose 2.8 percentage points to 89.8%. Total supply now stands 5% above last year, while including the SPR stands about 1.4% higher than a year ago.

FUEL DEMAND

According to GasBuddy demand data driven by its Pay with GasBuddy™ fuel card, U.S. retail gasoline demand saw a rise of 1.9% for the week ending December 2 (Sun-Sat). Broken down by PADD region, demand rose 1.7% in PADD 1, rose 1.3% in PADD 2, rose 1.1% in PADD 3, rose 9.4% in PADD 4, and rose 2.7% in PADD 5. GasBuddy models U.S. gasoline demand at 8.478 million barrels per day.

GAS PRICE TRENDS

The most common U.S. gas price encountered by motorists stood at $2.99 per gallon, unchanged from last week, followed by $3.19, $2.89, $3.09, and $3.29 rounding out the top five most common prices.
The median U.S. gas price is $3.07 per gallon, up 3 cents from last week and about 11 cents lower than the national average.
The top 10% of stations in the country average $4.61 per gallon, while the bottom 10% average $2.57 per gallon.
The states with the lowest average prices: Oklahoma ($2.65), Mississippi ($2.71), and Texas ($2.72).
The states with the highest average prices: California ($4.78), Hawaii ($4.68), and Washington ($4.31).

DIESEL PRICE TRENDS

The most common U.S. diesel price stood at $3.99 per gallon, unchanged from last week, followed by $4.19, $4.09, $3.89, and $4.29 rounding out the top five most common prices.
The median U.S. diesel price is $4.07 per gallon, down 2 cents from last week and about 11 cents lower than the national average for diesel.
Diesel prices at the top 10% of stations in the country average $5.36 per gallon, while the bottom 10% average $3.44 per gallon.
The states with the lowest average diesel prices: Texas ($3.59), Mississippi ($3.73), and Louisiana ($3.74).
The states with the highest average diesel prices: California ($5.73), Hawaii ($5.69), and Washington ($5.16).