The Energy Information Administration (EIA) produced new data that showed that gas demand and supply decreased. Moving from 9.78 million b/d to 9.43 million b/d last week, the latest demand measurement is 500,000 b/d lower than the rate at this time in 2019, according to AAA, signaling that summer gas demand is likely softening as the school year starts and concerns about transmission of COVID-19 grow as infection rates continue to increase. Additionally, total domestic gas stocks declined by 1.3 million bbl to 227.5 million bbl.
Although the drop in demand has helped to minimize pump price increases and stabilize the national average, elevated crude prices continue to keep pump prices high as the end of summer draws near.
The national average has held steady at $3.18 for seven days after reaching its highest point so far this year. Today’s national average is a penny less than a week ago, two cents more than a month ago and $1.01 more than a year ago. During the run-up to Labor Day weekend, pump prices will likely continue to fluctuate due to high crude prices. However, gas demand typically drops considerably after the final holiday weekend of summer, bringing much needed relief to American drivers when they fill-up this fall.
The nation’s top 10 largest changes: Alaska (+4 cents), Oregon (+4 cents), Michigan (−4 cents), Montana (+3 cents), Washington, D.C. (+3 cents), Kentucky (−3 cents), Illinois (−3 cents), Ohio (−3 cents), Washington (+2 cents) and Maryland (−2 cents).
The nation’s top 10 least expensive markets: Mississippi ($2.79), Louisiana ($2.83), Alabama ($2.84), Texas ($2.84), Oklahoma ($2.87), South Carolina ($2.87), Arkansas ($2.87), Missouri ($2.87), Tennessee ($2.87) and North Carolina ($2.92).
Oil Market Dynamics
At the close of Friday’s formal trading session, WTI decreased by 65 cents to settle at $68.44. Crude prices have declined last week due to market concerns that crude demand may not rebound this year as anticipated due to surging coronavirus infection rates across the globe. Price decreases occurred despite EIA’s latest report showing that total domestic crude stocks decreased nominally to 438.8 million bbl. For this week, crude prices could decline further if market concerns persist over increasing COVID-19 infection rates.