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.
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.