The national average price for a gallon of gasoline has risen 2.2 cents per gallon over the last week to $2.91 per gallon, according to GasBuddy data compiled from more than 10 million individual price reports. The average price of diesel surged, adding 5.9 cents to an average of $3.27 per gallon.
“The national average gas price has broken out of a well-established rut, climbing above $2.90 per gallon for the first time since mid-June on rising oil prices ahead of the reinstatement of sanctions against Iran and OPEC failing to pump enough oil to meet robust demand,” said Patrick DeHaan, head of petroleum analysis for GasBuddy. “We may see prices continue to lift ahead of the mid-terms, however completely unrelated to the elections, but due to constant threats from an improving economy: higher demand and lower supply is tipping the balance of the oil market and pushing prices higher. We may even soon see $3 per gallon nationally, which would be the first time since October 2014, if oil prices continue to rise. I, along with motorists, will be eagerly awaiting any relief at the pump, but don’t hold your breath – it may get worse before it gets better.”
Gasoline and diesel prices have moved higher, following oil to near four year highs on upcoming sanctions on Iran and OPEC’s hard line on increasing oil production to meet high global demand. The U.S. economy continues its streak of robust growth, adding a level of urgency for more oil production as unemployment rates fell to their lowest since 1969 last week.
While data from the Energy Information Administration showed crude oil inventories rising 8 million barrels last week, gasoline and distillate inventories both sagged as refineries continued to perform maintenance, reducing the flow of oil into refineries and products that came out. Oil prices opened the week just above $74 per barrel, a slight drop from a week ago, yet gasoline and diesel prices may continue edging higher, still catching up to rising oil prices.
Word of a fire at Canada’s largest refinery – Irving Oil’s Saint John refinery – pushed refined products higher in early trade Monday, and could affect prices moving forward as well. The refinery is a large contributor to supply in the Northeast United States and nearly all of its product flows into that region, which may result in a large hit to supply.
Back stateside, the national average is now at its highest level in months with little relief in sight. Average gas prices rose in most states, led by a 6.8 cent rise in Georgia, a 6.1 cent lift in California and a 5.8 cent rise in Louisiana.
States with the lowest average gas prices: South Carolina ($2.59), Mississippi ($2.60), Alabama ($2.62), Louisiana ($2.64) and Texas ($2.64)
States with the highest average gas prices: Hawaii ($3.80), California ($3.78), Washington ($3.42), Alaska ($3.30) and Oregon ($3.28).