WASHINGTON, Aug. 25 (UPI) — Though at historic lows on average, refinery issues in the United States and higher demand put upward pressure on gasoline prices, retail market analyses find.
Motor club AAA reports a national average retail price for a gallon of unleaded gasoline for Tuesday at $2.57, down a fraction of a percent from Monday. Tuesday’s price is down about 5 percent from one month ago and represents the lowest price for this date in more than a decade.
The average retail price nation-wide was skewed upward in early August after BP reported an unscheduled outage at its refinery in Whiting, Ind., the sixth largest in the nation and a key gasoline supplier to the Great Lakes states. Prices in Chicago and other major metropolitan areas topped the $3 mark, though prices regionally have since moderated after BP secured additional supplies to meet its contractual demands.
BP has been tight-lipped about the status of repairs at Whiting.
AAA expects most drivers, including those in the Great Lakes states, will see retail gasoline prices flirting with $2 per gallon by Christmas.
“Average gas prices would be near that point today if refineries were running smoothly and demand was similar to recent years,” the motor club said in a weekly market report. “Instead, major refineries have experienced problems and driving has been at record-high levels.”
Crude oil prices below the $40 per barrel mark, meanwhile, are keeping prices at the pump lower. The low price of oil should put negative pressure on gasoline prices. For price watchdog GasBuddy.com, it’s refinery issues that should be the driver for gasoline prices moving forward this year.
“Pump prices are likely to continue to move lower country-wide, so long as the refining wildcard remains in check,” it said in an emailed report. “With the conclusion of the summer driving season, demand will begin to move lower, and combined with the return of cheaper winter gasoline in mid-September, much downward pressure remains at the pump.”
AAA added there are around a dozen states with at least one retail station selling gasoline below $2 per gallon.
