Gas prices have been up and down this week in some Mid-Atlantic markets

The Week

Prices at the pump have been on a bit of a roller coaster this week, heading both higher and lower. Reports reveal the typical spike in gasoline demand has not taken hold yet, which can cause prices to increase while oil production has escalated, causing crude prices and, in turn, gas prices to dip. Today’s national average price for a gallon of regular unleaded gasoline is $2.40, down 2 cents in the last week, up 12 cents over last month and 23 cents more than this time last year.

Consumers throughout the Mid-Atlantic region will likely see gas prices increase once demand grows stronger with the arrival of the summer driving season. Looking further ahead, there is early indication that the start of the Dakota Access Pipeline could impact Northeast gas prices with the potential for crude prices to rise as a result of more competition in the market looking to sell crude oil.

CURRENT AND PAST GAS PRICE AVERAGES

Regular Unleaded Gasoline (*indicates record high)

 
04/28/17
Week Ago
Year Ago
National
$2.40 $2.42
$2.17
New Jersey
$2.43
$2.44
$2.03
Trenton
$2.47
$2.48
$2.05
Cape May County
$2.43
$2.42
$2.01
Burlington
$2.37
$2.37
$1.98
Middlesex, Somerset, Hunterdon Counties
$2.45
$2.46
$2.04
Monmouth, Ocean Counties
$2.45
$2.45
$2.03
Crude Oil

$49.15 per barrel (04/28/17)

$49.62 per barrel (04/21/17)
$46.03 per barrel (04/28/16)

At the close of Friday’s formal trading session on the NYMEX, WTI settled at $49.15 per barrel. One of the leading reasons for the drop in crude oil prices was skepticism about whether the Organization of the Petroleum Exporting Countries (OPEC) and other producers would extend their pledge to cut output by 1.8 million barrels by another six months. In particular, the market is still unsure if Russia will agree to an extension deal beyond June 30, which could add to an already bloated global inventory. In addition, crude prices fell more than one percent Thursday after the restart of two key oilfields in Libya pumped more crude into the market.

The Weekend

“Drivers may encounter brief relief at the pump as a result of the increased output of gasoline refineries,” said Tracy E. Noble, Manager of Public and Government Affairs for AAA Mid-Atlantic. “If this continues, gasoline production will occur at a much higher rate than there is an appetite for, as demand currently remains muted compared to last year.”

The Week Ahead

Pressuring the market are continued doubts about whether ongoing production cuts led by the Organization of Petroleum Exporting Countries (OPEC) are enough to eliminate the surplus of oil in global stockpiles. OPEC will decide next month (May 25) whether to extend those current production caps. Prices have stalled as a result of rebounding U.S. oil output and prices could remain range-bound a bit longer. Some analysts don’t believe oil prices will rise very much before the OPEC meeting, possibly giving motorists a break at the pump.