NATIONAL AVERAGE FALLS TO LOWEST LEVEL SINCE APRIL AHEAD OF HOLIDAY

As motorists hit the road for the July 4 holiday weekend, the nation’s average price of gasoline has fallen 4.1 cents from a week ago, declining to $3.54 per gallon, according to GasBuddy data compiled from more than 11 million individual price reports covering over 150,000 gas stations across the country. The national average price of diesel has fallen 3.4 cents in the last week and stands at $3.80 per gallon.

“Just ahead of Independence Day, the national average has fallen to its lowest level since late April, with oil prices remaining under considerable pressure due to a cloudy outlook for the global economy. We could see gasoline prices under some additional pressure soon, especially as we head into the closing innings of summer next month,” said Patrick De Haan, head of petroleum analysis at GasBuddy. “For now, gasoline demand will likely ramp up as we enter the peak of the summer, with millions of Americans set to take to the roads with some of the season’s lowest average gasoline prices. At the halfway point of the year, the national average is right at the level we anticipated for a full-year average. While that’s good news, I believe we may see prices close out the second half of the year below our expectations. This would be welcome news for motorists as the national average could fall below $3 per gallon this fall.”

OIL PRICES

Saudi Arabia announced over the weekend that it would voluntarily extend its 1 million barrel-per-day production cut that just began into August after the cut failed to push oil prices higher as disappointment from a cooling global economy had trumped the announcement weeks ago. In early Monday trade, a barrel of West Texas Intermediate crude oil was up 78 cents to $71.42 per barrel, up almost $2 from last Monday’s $69.49 per-barrel start. Brent crude oil was also trading higher, up 71 cents to $76.12 per barrel after opening last week around $74.28. The holiday-shortened week could bring with it a mellow response to the Saudi extension, but with the summer driving season nearing its halfway mark, it may be a struggle to get oil prices to respond to the Saudi cut to the degree they desire. China’s reopening has continued to disappoint, and with monetary policy continuing to tighten, economic growth has been curbed significantly.

OIL AND REFINED PRODUCTS

Last week’s report from the Energy Information Administration showed a substantial 9.6 million barrel decline in U.S. crude oil inventories, which are now 1% below the five-year average for this time of year, while the SPR fell another 1.4 million barrels and stand 30% below a year ago. Gasoline inventories bucked that trend, rising 600,000 barrels, and are just above their year-ago level while holding at a 7% deficit to the five-year average. Distillate inventories edged up by 100,000 barrels, and stand 1.8% above last year, while still looking at a 14% drop compared to the five-year average. Implied gasoline demand fell 68,000 bpd to 9.31 million barrels per day, while refinery utilization fell almost a percentage point to 92.2%. Crude oil imports also jumped 418,000 bpd to 6.58 million barrels per day, while exports surged by 795,000 bpd to 5.34 million.

FUEL DEMAND

According to GasBuddy demand data driven by its Pay with GasBuddy™ fuel card, U.S. retail gasoline demand saw a 4.2% jump last week (Sun-Sat) as motorists began their July 4 travels. Broken down by PADD region, demand rose 6.8% in PADD 1, rose 1.5% in PADD 2, rose 5.2% in PADD 3, rose 6.1% in PADD 4, and rose 2.9% in PADD 5.

GAS PRICE TRENDS

The most common U.S. gas price encountered by motorists stood at $3.19 per gallon, down 10 cents from last week, followed by $3.29, $3.49, $3.39, and $3.09 rounding out the top five most common prices.
The median U.S. gas price is $3.39 per gallon, unchanged from last week and about 11 cents lower than the national average.
The top 10% of stations in the country average $4.78 per gallon, while the bottom 10% average $2.99 per gallon.
The states with the lowest average prices: Mississippi ($2.93), Louisiana ($3.03), and Tennessee ($3.05).
The states with the highest average prices: Washington ($4.92), California ($4.79), and Hawaii ($4.67).

DIESEL PRICE TRENDS

The most common U.S. diesel price stood at $3.69 per gallon, unchanged from last week, followed by $3.59, $3.49, $3.99, and $3.79 rounding out the top five most common prices.
The median U.S. diesel price is $3.69 per gallon, unchanged 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 $4.89 per gallon, while the bottom 10% average $3.17 per gallon.
The states with the lowest average diesel prices: Texas ($3.31), Louisiana ($3.37), and Mississippi ($3.45).
The states with the highest average diesel prices: Hawaii ($5.66), California ($4.95), and Washington ($4.91).