Despite Stock Market Woes and Refinery Issues, Gas Prices Continue To Drop

The Week

Gas prices across most of the country, including New Jersey, continue to decline with the national average price now at the lowest level for this time of year since 2004, despite ongoing refinery problems.

Year-over-year discounts for the price of gasoline persist, largely due to the price of crude being significantly discounted from this date in 2014.  Pump prices in nearly every state (48 and Washington, D.C.) are more than 50 cents per gallon lower than this same date last year.

New Jersey’s average price is 29 cents lower than the national average at $2.22 per gallon.  The state average is ten cents lower than last week, 36 cents less than a month ago, and $1.04 less per gallon than last year on this date.

Today’s national average price of gasoline is $2.51 per gallon, which is 12 cents less than a week ago, 19 cents less than last month, and 92 cents per gallon lower than a year ago. Pump prices are now 29 cents per gallon below the 2015 peak price of $2.80 per gallon reached on June 15. 

CURRENT AND PAST GAS PRICE AVERAGES

Regular Unleaded Gasoline (*indicates record high)

 
08/28/2015
Week Ago
Year Ago
National
$2.51 $2.63
$3.43
New Jersey
$2.22
$2.32
$3.26
Trenton
$2.29
$2.38
$3.29
Cape May County
$2.29
$2.39
$3.21
Burlington
$2.14
$2.24
$3.19
Middlesex, Somerset, Hunterdon Counties
$2.21
$2.31
$3.26
Monmouth, Ocean Counties
$2.24
$2.34
$3.25
Crude Oil

$45.38 per barrel

$40.25 per barrel
$94.55 per barrel

Crude oil prices have continued to sag, due to continuing global oversupply and evidence of slower than projected growth in the Chinese economy.  At the NYMEX market close on Friday, West Texas Intermediate (WTI) crude oil closed up over the $40 per barrel mark at $45.38 per barrel, still a significantly low price.  This new high for the week to-date comes after three consecutive days of settling in the $38-$39 per barrel range – a new 2015 low and the lowest level since March 2009. 

The Weekend

“The biggest chunk of what motorists pay for a gallon of gas, almost 65 percent, is comprised by the cost of crude oil. So when the price of oil drops, gas prices at the pump fall as well,” says Tracy E. Noble, Manager of Public and Government Affairs for AAA Mid-Atlantic. “As the summer driving season draws to an end, motorists can expect gas prices to continue remaining favorable as a result of low crude oil prices.”

The Week Ahead

Gas prices should continue to fall this autumn due to declining demand as motorists travel less and with the switchover to winter-blend gasoline, which begins in September.  Nationwide gas prices could dip below the $2-per-gallon mark for the first time since March 24, 2009, possibly by Thanksgiving.  However, any geo-political issues or unforeseen natural disaster such as a hurricane could disrupt the supply of oil or gasoline and cause gas prices to trend upward instead.