Monthly Archives: November 2013

Cost Of Driving Lurches Upward At Thanksgiving

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The price of traveling during the Thanksgiving Holidays surged during the past week, with the average price of a gallon of regular unleaded gas rising more than 7¢ per gallon, according to the latest weekly gas price survey from the U.S. Energy Information Administration. The price of fuel had been decling rapidly during most of October, but the increase in demand for petroleum products, in advance of the holiday, has helped contribute to rising prices. The current U.S. average is back up to $3.29 per gallon.

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The average price of gas in the U.S. notched back up to $3.29 per gallon during the past week, although some regions enjoyed further price declines. In other areas, like Texas and Florida, the price of gas soared between 16¢ and 19¢ per gallon.

The week-over-week gains in gas prices did not affect the West Coast or California, where prices continued to drop during the past week. In fact, the average price of gas in California actually slipped behind New York state during the most recent survey, with drivers in the Golden State paying about $3.55 per gallon and New Yorkers paying an average of $3.57. Price declines in the Rocky Mountain region were the greatest, however, with an average 4¢ per gallon decline in fuel costs at the pump. The Rocky Mountain region has the second-lowest gas prices in the U.S., being only one cent higher in cost than the average price across the Gulf Coast.

City by city, drivers in Miami fared worse than nearly everywhere else during the past week, with gas prices surging a whopping 15¢ per gallon in South Florida, and prices in the Sunshine state up an astonishing 19¢ per gallon. In Texas, the only other state where gas prices surge so much, the price drivers are paying at the pump lurched upward by an average of 16¢. Drivers in Houston are paying about 17¢ per gallon more for gas, the only major city where prices jumped more than Miami.

The cost of diesel fuel finally reversed or halted its downward trend, as prices in nearly all regions increased by a penny or more during the past week. On average, truckers and diesel car drivers paied about 2¢ more per gallon during the past week, while drivers in the Midwest ended up paying as much as 4¢ more. Prices in California and the broader West Coast paid the same, with the average prices at the same levels as last week.

Year over year, most of us are paying less than we were at Thanksgiving time in 2012. However, that trend does not hold for Florida and Texas, the fourth and second largest states in the U.S., respectively, by population.

Regardless of the past two weeks’ trends of rising fuel costs, the EIA has not adjusted its December price forecast or its 2014 price projections. Fuel costs are expected to continue their downward slide through December and for most of 2014, with moderate price increases expected during peak travel times.

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Gas Prices Slip Upward In States East Of Rocky Mountains

Price Declines In Recent Weeks Come To Abrupt Halt

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The price of gasoline, which has been going down for several weeks, did an about-face last week as the cost of filling up suddenly lurched upward a few cents. The Midwest, Central Atlantic and Lower Atlantic regions of the U.S. were hardest hit, with gas price increases of four and five cents per gallon, on average. The national average price of gas slipped upward to $3.22 per gallon of regular unleaded, according to the weekly gas price survey from the U.S. Energy Information Administration. Even the Gulf Coast, which enjoyed a week with official survey prices below the $3.00 threshold, found the average price of gasoline back to the 3-dollar mark, although many stations from Texas through the Florida panhandle have prices well below $3.00.

Despite the increase in gas prices in the eastern states, the West Coast region and the Rocky Mountain region of the U.S. enjoyed more relief from price pressures at the pump. The average price of gas in the Rockies and the broader West Coast regions fell an average four cents per gallon, with the price of unleaded ranging in average from $3.18 in Idaho and Montana to $3.47 in California.

Diesel pumps at the Pompano Beach Service Plaza

Diesel prices continued their slow decline during the past week, bucking a trend of higher fuel costs for other drivers.

Diesel prices also continued to decline during the past week, helping offset shipping costs related to fuel. The average price of a gallon of diesel was down to $3.82 across the nation, although trukcers in New England are still paying at or above $4.00 in some places. As with regular gas, the lowest costs for diesel are in the Gulf Coast region.

Gas Price Increases Not Expected To Endure

The uptick in prices for most regular drivers may be short lived. The EIA has long been forecasting continued declines in petroleum prices, with an expected upward turn in prices only expected in January. The EIA long-range forecasts show the price of fuel will keep falling through December, rise slightly in January, then continue declining for the remainder of 2014.

Service plaza near Warren, Ohio.

Gas prices are likely to continue their downward trend, despite last week’s cost increases.

The upward pressure on prices may have been the result of tighter gas supply stocks after the first week of November. The EIA’s weekly petroleum status report, which is separate from the gas price survey, shows the weekly motor gasoline stocks declined by about 8-million barrels from November 1 to November 9, and crude oil input to refineries also declined during the same period. The crude stocks dropped from a high of 14.95-million barrels per day on November 1 to only 14.73-million barrels per day on November 9. However, daily crude input to refineries can fluctute considerably from day to day.

As for the crude oil prices, themselves, West Texas Intermedia continues flirting with levels below $93, although prices were up to $93.37 after the lunch hour Tuesday. Brent crude has also continued to remain well north of $100, and was trading near $107 per barrel late in the day Tuesday. The issue with crude, however, is two-fold. On one hand, current prices are for December delivery, although fuel suppliers, including gas retailers, use a last-in, first-out accounting method. On the other, foreign crude supplies account for only about 40% of U.S. oil consumption, leaving the WTI with greater influence on domestic fuel costs to drivers.

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Pennsylvania Turnpike Tolls Going Up January 5

2014 Toll Increase In Keystone State Will Hit Cash Customers Hardest

The cost of driving the Pennsylvania Turnpike will be increasing again when tolls are raised on January 5, 2014. Tolls have gone up annually on the Penna Turnpike, in recent years, to help pay for roadway renovations, expansions and a massive service plaza upgrade program that is winding down in 2014.

download Download a copy of the new toll rates here (PDF).

Traffic on Pennsylvania Turnpike

Drivers on the Pennsylvania Turnpike are about to be hit with another annual price increase, and for cash customers, the increases are even higher than last year.

The rate hikes will hit cash customers hardest, as the average cash rate will surge by about 12%, according to the Pennsylvania Turnpike Commission, which announced the rate increase during the peak of the summer driving season. The increase was approved in mid July.

The PTC has been pushing more people to buy the electronic tolling device, E-ZPass, citing a lower cost of operation. Providing staff for toll booths is significantly reduced with the E-ZPass, and overall toll collection is anywhere from one-fifth to only one-tenth the cost of having to collect cash tolls, according to the PTC’s estimates. In fact, the 2014 cash price increase is 20% higher than 2013, while the E-ZPass rates are going up by the same percentage.

In fact, E-ZPass rates will only increase by about 2% on January 5, as opposed to the 12% for cash tolls. For short-distance travelers, the increase may not be little more than an irritation. The PTC reports the average cash toll on the Pennsylvania Turnpike is about $4.49, as opposed to $2.92 using the E-ZPass on the same trip.

Truckers To Face Steep New Travel Costs

However, the longer the distance traveled, the greater the pinch on the wallet. A traveler driving the full-length of the mainline, from Ohio to New Jersey, currently pays $39.15 in cash tolls, versus $30.77 for E-ZPass users. And those are only the lower rates, for passenger cars.

View of NJ turpike extension heading toward the Pennsylvania Turnpike at the Delaware River

Trucks coming into Pennsylvania will be even costlier for operators, as higher-weight and more axles add significantly to toll costs, particularly for long-distance haulers.

With such a dramatic price increase in the cash toll rate, the coming differential will certainly be felt for both commuters and long-distance travelers. However, it is truckers who will really be hard hit by the rate increase. Currently, a 5-axle truck hauling about 35,000 pounds of freight will incur $121.80 in cash tolls; after January 5, that figure will increase to $136.40. E-ZPass prices will be higher, but the rate will only go from the current $96.03 to $97.95.

And the bigger the truck or heavier the load, the higher the price will be. Tolls on the Pennsylvania Turnpike can run into the thousands of dollars for a trucker paying cash, and the 2014 price increase will ruther exacerbate those costs. In fact, the falling cost of diesel fuel will be lost in Pennsylvania, primarily offset by the coming turnpike toll increase.

The PTC has not announced whether it will continue raising rates on an annual basis and in perpetuity. However, regular drivers on Pennyslvania’s Turnpike and Northeast Extension have become accustomed to paying a new toll with the new year. For 2014, however, the rate increase comes a day earlier than it did in 2013.

The Pennsylvania Turnpike Commission news release, announcing the toll increases, may be downloaded here.

 

download Download a copy of the new toll rates here (PDF).

Gas Prices Hit New Lows As Seasonal Migrations Flare Up

Prices Officially Slip Below $3.00 Per Gallon In Some Areas

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The cost of gasoline has hit another fresh low this week, with the average price of a gallon of regular unleaded now at just $3.19, a sharp drop of over 7¢ from last week. This week also marks the first time this season prices have dipped below $3.00 per gallon, according to the weekly gas price survey from the U.S. Energy Information Administration. Although most regional prices are not yet below the $3.00 level, drivers in states along the Gulf Coast are paying an average of $2.98 per gallon. In some areas, the price is much lower.

Gas prices under three dollars

Gas prices at some stations, like this one in near Austin, Texas, reflect a trend to prices under $3.00 for many areas.

The cheaper cost of driving comes at a fortuitous time for seasonal travelers, many of whom are heading to southern states, particularly Florida, to take up winter residency. The new price lows also come ahead of holiday traveling, which will begin picking up volume by late November with Thanksgiving.

While the lowest regional average was in the Gulf Coast, many other areas are enjoying very cheap gas. Drivers across the Midwestern states are enjoying an average $3.07 gas price, while travelers across the broader eastern seaboard are paying an average $3.24. California and West Coast drivers are still paying up to $3.51, on average, for regular unleaded.

Truckers Benefit From Lower Diesel Prices

The cost of operating a diesel rig or fleet of trucks has gone down, at least in terms of fuel costs. The price of the average gallon of diesel is now at $3.83, nationwide, and at a low of $3.75 for Gulf Coast truckers. However, prices at many stations near toll roads, like ones in Texas, are witness to prices well below their regional averages. At one station near Austin, close to the Texas 45 Toll Road, the price of diesel was only $3.59 per gallon.

Too Much Supply As WTI Heads Lower

Lower crude oil prices in recent weeks have contributed to the decline in fuel prices, but there is also a glut of supply at many refineries, even as refinery capacity is undergoing seasonal adjustments. As for the price of crude, West Texas Intermediate (WTI) closed Tuesday at $93.16, although it had traded as low as $92.86, intraday. Brent crude closed at $106.14, although it had been as low as $103.46 late last week.

The lower seasonal demand, despite spikes in traffic around certain holidays, is also another factor playing into the reduced price of gas. But there is a longer-term trend toward even lower prices, according to a recent forecast from the EIA. Gas prices are expected to continue decling through the holiday season and well into 2014, according to the report.

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Gas Keeps Getting Cheaper, Making For Early Holiday Gift

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The price of gas continues to fall across the nation, although the declines are a bit smaller as November gets underway, according to this week’s report from the U.S. Energy Information Administration. The EIA report shows the price of a gallon of regular unleaded fell to a nationwide average of $3.27, which is about two cents less than last week. some regions, as usual, enjoyed a larger decline than others. The Rocky Mountain states had the biggest weekly drop in fuel costs, with the average price at the pump down by about 6¢ per gallon.

Gas prices in South Florida

The price of gas across many regions is now below $3.30, with some areas, like the Gulf Coast, close to $3.00. Picture taken Mon., Nov. 4 in Oakland Park, Florida.

The price of gas in the Gulf Coast states was nearly at $3.00 per gallon, the only region that is that close, officially, to having three-dollar gas. For most of us, the price is between $3.20 and $3.30 per gallon. Moreover, gas prices in most regions are now lower than at the start of 2013.

By mid summer, the cost of driving had gone so high, many drivers were paying near or just over $4.00 per gallon for fuel. The price of diesel was even higher, making a fill-up for a trucker a costly endeavor.

The price of diesel is down this week, as well, following the trend of regular gasoline. However, the cost of diesel is not declining as quickly as with regular unleaded. The average price of a gallon of diesel is down about a penny per gallon, although some parts of the West Coast and California are seeing declines of 2¢ and 3¢ per gallon, respectively.

The price of gas is expected to level off by mid-December, according to a recent forecast by the EIA. The projected price of gas near the height of the holiday season is expected to hover around $3.15 per gallon. If current trends are any indication, some regions will have gas prices lower than $3.00 gallon, particularly the Gulf Coast.

On the futures exchanges, the price of West Texas Intermediate (WTI) was down to a five-month low Tuesday evening, after closing in on $93 per barrel. Even Brent is down significantly, moving closer to $105 per barrel. Tuesday prices fell considerably for both WTI and Brent, with the U.S. crude futures having fallen five out of the past six sessions.

A report from Reuters states U.S. oil supplies are up, reducing demand for future deliveries. The report cites an increase of about 2-million barrels of oil at a stock yard in Cushing, Oklahoma, which is the largest increase in supply there since December 2012.

When the glut of supply is matched with reduced refinery demand, the combination gives a one-two punch to the price of oil futures, which translates into lower prices at the retail level. However, due to oil companies’ accounting practices, retail prices declines, due to lower crude prices, typically time to manifest.

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