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Orcun Tezel
--OPEC's bid to curb production of high-cost oil is taking time to produce results but the organization is already making good progress on its other objective of stimulating fuel demand.--
In the first half of the year, gasoline deliveries into U.S. local markets jumped by 4.3 percent compared with the same period in 2014, according to the U.S. Energy Information Administration.
The United States is the world's largest gasoline consumer and its gasoline demand accounts for 10 percent of all crude and condensates produced worldwide.
In the first six months of 2015, U.S. gasoline consumption rose at the fastest rate since 1985 - another occasion on which the real price of oil halved over 12 months and stimulated demand .
U.S. gasoline sales have fallen or stagnated for the last decade as the high cost of fuel encouraged motorists to use their cars less and buy smaller and more fuel efficient vehicles.
But the sharp drop in fuel prices since the middle of last year is stimulating demand again by encouraging more driving and motorists to purchase much bigger and heavier vehicles.
According to the Federal Highway Administration, the volume of traffic on U.S. roads in the first half, measured in vehicle-miles traveled, was up 3.5 percent compared with 2014.
Rising economic output, employment, wages and incomes are all helping spur increased driving as more drivers make the daily commute.
But traffic volumes are increasing faster than most measures of economic activity, incomes and employment, so it seems likely cheaper fuel prices are also encouraging motorists to use their cars more.
Cheaper fuel is also encouraging motorists to start buying larger vehicles. Car sales were down nearly 3 percent in January-August compared with 2014, but light truck sales surged 10 percent, according to Wards Auto.
In the first eight months of 2014, the ratio of car/truck sales split roughly 48/52, but in the same period of 2015 the ratio split 45/55.
Truck sales as a percentage of total light duty vehicle sales are running at the highest share on record, according to the U.S. Environmental Protection Agency, as low fuel prices make trucks more attractive.
Prodded by federal fuel efficiency standards, both cars and trucks are using less fuel than before, but the shift towards bigger vehicles is helping stimulate more consumption.
OPEC's decision to maintain output and allow prices to fall is having a double impact on demand: traffic is growing faster than the economy, and fuel sales are growing faster than traffic.
U.S. gasoline sales in the first half of this year were running 350,000 barrels per day (bpd) ahead of the first half of 2014, enough to make a small but significant dent in global oversupply.
And the pick-up in motoring is not confined to the United States. The volume of traffic on Britain's roads is growing at the fastest rate since 2002, according to the UK Department for Transport.
The critical question for OPEC and the oil market is whether fuel demand will continue growing at this pace in 2016.
The trend towards more light truck sales should keep boosting fuel demand, at least compared with the previous trend, provided gasoline prices remain low.
Continued economic expansion, employment growth and income gains should also be positive for fuel sales in the United States and Europe.
With demand increasing and non-OPEC crude oil supplies forecast to decline in 2016 the oil market is gradually moving back towards balance.
Orçun Tezel
Gasoline
In the first half of the year, gasoline deliveries into U.S. local markets jumped by 4.3 percent compared with the same period in 2014, according to the U.S. Energy Information Administration.
The United States is the world's largest gasoline consumer and its gasoline demand accounts for 10 percent of all crude and condensates produced worldwide.
In the first six months of 2015, U.S. gasoline consumption rose at the fastest rate since 1985 - another occasion on which the real price of oil halved over 12 months and stimulated demand .
U.S. gasoline sales have fallen or stagnated for the last decade as the high cost of fuel encouraged motorists to use their cars less and buy smaller and more fuel efficient vehicles.
But the sharp drop in fuel prices since the middle of last year is stimulating demand again by encouraging more driving and motorists to purchase much bigger and heavier vehicles.
According to the Federal Highway Administration, the volume of traffic on U.S. roads in the first half, measured in vehicle-miles traveled, was up 3.5 percent compared with 2014.
Rising economic output, employment, wages and incomes are all helping spur increased driving as more drivers make the daily commute.
But traffic volumes are increasing faster than most measures of economic activity, incomes and employment, so it seems likely cheaper fuel prices are also encouraging motorists to use their cars more.
Cheaper fuel is also encouraging motorists to start buying larger vehicles. Car sales were down nearly 3 percent in January-August compared with 2014, but light truck sales surged 10 percent, according to Wards Auto.
In the first eight months of 2014, the ratio of car/truck sales split roughly 48/52, but in the same period of 2015 the ratio split 45/55.
Truck sales as a percentage of total light duty vehicle sales are running at the highest share on record, according to the U.S. Environmental Protection Agency, as low fuel prices make trucks more attractive.
Prodded by federal fuel efficiency standards, both cars and trucks are using less fuel than before, but the shift towards bigger vehicles is helping stimulate more consumption.
OPEC's decision to maintain output and allow prices to fall is having a double impact on demand: traffic is growing faster than the economy, and fuel sales are growing faster than traffic.
U.S. gasoline sales in the first half of this year were running 350,000 barrels per day (bpd) ahead of the first half of 2014, enough to make a small but significant dent in global oversupply.
And the pick-up in motoring is not confined to the United States. The volume of traffic on Britain's roads is growing at the fastest rate since 2002, according to the UK Department for Transport.
The critical question for OPEC and the oil market is whether fuel demand will continue growing at this pace in 2016.
The trend towards more light truck sales should keep boosting fuel demand, at least compared with the previous trend, provided gasoline prices remain low.
Continued economic expansion, employment growth and income gains should also be positive for fuel sales in the United States and Europe.
With demand increasing and non-OPEC crude oil supplies forecast to decline in 2016 the oil market is gradually moving back towards balance.
Orçun Tezel
Gasoline
· 3
Orcun Tezel
Oil tumbles; large gasoline build trumps U.S crude draw
Global oil markets tumbled on Wednesday, with U.S. crude futures settling down 4 percent after bullish impact from lower crude inventories was offset by large gasoline builds that raised concerns about high autumn fuel supplies.
Also weighing on crude were Colonial Pipeline's efforts to fix an outage on one of its lines that had been supporting prices of gasoline, and the larger oil complex, since Tuesday.
Brent, the global benchmark for oil, LCOc1 settled down $1.33, or 2.7 percent, at $47.75 a barrel.
U.S. crude CLc1 slumped $1.88, or 4.1 percent, to settle at $44.48.
Gasoline RBc1 finished down 2 percent after hitting two-week highs earlier in the day.
Crude prices had initially rallied 2 percent, with Brent briefly peaking above $50, after the U.S. government reported a drawdown of about 2 million barrels for a second week in a row. [EIA/S]
"The crude numbers were not a big surprise in any way," said Tariq Zahir of Tyche Capital Advisors in Laurel Hollow, New York.
"A draw we did see but there was also a bigger-than-expected build in gasoline. The bottom line is we think any rallies, if we do see them, will be short lived and we will sell into them," said Zahir, an oil bear.
Analysts polled by Reuters had forecast a 533,000-barrel drop last week.
The EIA said gasoline stockpiles rose 1.4 million barrels, compared with the Reuters poll which called for a 819,000-barrel gain.
On the East Coast, distillate inventories rose to 59 million barrels, which according to the EIA was the highest since 2011 for this time of year.
Distillates include fuel oil and diesel. The East Coast is home to the New York Harbor, which is delivery point for U.S. gasoline RBc1 and ultra-low sulfur diesel (ULSD) HOc1 futures.
The high distillate stockpiles topped the concerns of some traders, worried about weak motor fuel consumption from the fall season, which began on Wednesday, through winter.
For others, upcoming maintenance at most U.S. refineries also meant less crude processing.
"While gasoline inventories will see maintenance-sponsored dips in coming weeks, crude will go the other way," said Matt Smith, director of commodity research for ClipperData, an energy data provider in New York.
Colonial Pipeline said it expects to restart by 6 p.m. EDT (2200 GMT) its Line 3 and 4 pipelines, reported shut since Tuesday afternoon. Line 3 alone has a capacity to carry 850,000 barrels of gasoline and distillates from North Carolina to Colonial's New Jersey hub in Linden.
Gasoline
Orcun TEZEL
Global oil markets tumbled on Wednesday, with U.S. crude futures settling down 4 percent after bullish impact from lower crude inventories was offset by large gasoline builds that raised concerns about high autumn fuel supplies.
Also weighing on crude were Colonial Pipeline's efforts to fix an outage on one of its lines that had been supporting prices of gasoline, and the larger oil complex, since Tuesday.
Brent, the global benchmark for oil, LCOc1 settled down $1.33, or 2.7 percent, at $47.75 a barrel.
U.S. crude CLc1 slumped $1.88, or 4.1 percent, to settle at $44.48.
Gasoline RBc1 finished down 2 percent after hitting two-week highs earlier in the day.
Crude prices had initially rallied 2 percent, with Brent briefly peaking above $50, after the U.S. government reported a drawdown of about 2 million barrels for a second week in a row. [EIA/S]
"The crude numbers were not a big surprise in any way," said Tariq Zahir of Tyche Capital Advisors in Laurel Hollow, New York.
"A draw we did see but there was also a bigger-than-expected build in gasoline. The bottom line is we think any rallies, if we do see them, will be short lived and we will sell into them," said Zahir, an oil bear.
Analysts polled by Reuters had forecast a 533,000-barrel drop last week.
The EIA said gasoline stockpiles rose 1.4 million barrels, compared with the Reuters poll which called for a 819,000-barrel gain.
On the East Coast, distillate inventories rose to 59 million barrels, which according to the EIA was the highest since 2011 for this time of year.
Distillates include fuel oil and diesel. The East Coast is home to the New York Harbor, which is delivery point for U.S. gasoline RBc1 and ultra-low sulfur diesel (ULSD) HOc1 futures.
The high distillate stockpiles topped the concerns of some traders, worried about weak motor fuel consumption from the fall season, which began on Wednesday, through winter.
For others, upcoming maintenance at most U.S. refineries also meant less crude processing.
"While gasoline inventories will see maintenance-sponsored dips in coming weeks, crude will go the other way," said Matt Smith, director of commodity research for ClipperData, an energy data provider in New York.
Colonial Pipeline said it expects to restart by 6 p.m. EDT (2200 GMT) its Line 3 and 4 pipelines, reported shut since Tuesday afternoon. Line 3 alone has a capacity to carry 850,000 barrels of gasoline and distillates from North Carolina to Colonial's New Jersey hub in Linden.
Gasoline
Orcun TEZEL
· 1
Orcun Tezel
Oil surges more than 5% as US crude stockpiles fall
Oil rose more than 5 percent on Wednesday after an unexpected drawdown in U.S. stockpiles, an increase in U.S. gasoline prices, and on the back of rising global markets.
Front-month U.S. crude futures traded up $2.34, or 5.2 percent, at $46.93 per barrel at 12:16 p.m. EDT, tracking for its biggest daily gain since Aug. 31 when it rose 8.8 percent.
Brent was up $1.91, or 4 percent, at $49.66 a barrel.
Read MoreOil rises after Obama says no to crude exports
Traders told CNBC the market had been anticipating a technical move higher. US crude's gains accelerated after it broke through its 50-day moving average of $46.50.
The U.S. government's Energy Information Administration reported crude inventories fell by 2.1 million barrels in the last week,compared with analysts' expectations for an increase of 1.2 million barrels. Crude stocks at the Cushing, Oklahoma, delivery hub fell by 1.906 million barrels, EIA said. The withdrawal was the biggest draw at Cushing since February, 2014.
Gasoline stocks rose by 2.8 million barrels, compared with analysts' expectations in a Reuters poll for a 21,000-barrel decrease.
John Kilduff, founding partner at Again Capital, said the EIA report was modestly bullish, but did not justify such a large move.
Potentially boosting oil, said Kilduff, was testimony from U.S. CENTCOM Commander General Lloyd Austin confirming that U.S. Special Operations Forces troops are now on the ground in Syria assisting Kurdish forces in their fight against the Islamic State and other insurgents.
Reports of Russian troop activity in Syria have already added a few dollars to the price of oil, he said, noting that the country's civil war is attracting more attention in light of a worsening migrant crisis.
Global stock markets rose ahead of a U.S. Fed two-day session to decide whether to raise rates for the first time in a decade.
Higher U.S. interest rates would likely attract cash from money traders, lifting the dollar. That could be bearish for oil markets as it would raise prices for holders of other currencies.
The prospect of falling U.S. oil production as prices skim six-year lows has narrowed the gap between benchmark U.S. and Brent crude futures.
The Brent-WTI spread between the two prompt months shrank on Tuesday to around $1.45 a barrel, the narrowest since January, when WTI briefly cost more than Brent. The spread was around $2.68 on Wednesday.
"We believe that this could be the market's reaction to the decline in U.S. crude production (drilling) ... further exacerbated as Iranian crude could be entering the market, which puts heavy pressure on the global benchmark (Brent)," said Daniel Ang, analyst at Singapore-based Phillip Futures.
Iranian crude stored in tankers could quickly enter world markets once sanctions against Tehran are
Oil prices have fallen by almost 60 percent since June 2014 on concerns about oversupply and slowing Asian demand, factors that continue to weigh on prices.
Gasoline
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Oil rose more than 5 percent on Wednesday after an unexpected drawdown in U.S. stockpiles, an increase in U.S. gasoline prices, and on the back of rising global markets.
Front-month U.S. crude futures traded up $2.34, or 5.2 percent, at $46.93 per barrel at 12:16 p.m. EDT, tracking for its biggest daily gain since Aug. 31 when it rose 8.8 percent.
Brent was up $1.91, or 4 percent, at $49.66 a barrel.
Read MoreOil rises after Obama says no to crude exports
Traders told CNBC the market had been anticipating a technical move higher. US crude's gains accelerated after it broke through its 50-day moving average of $46.50.
The U.S. government's Energy Information Administration reported crude inventories fell by 2.1 million barrels in the last week,compared with analysts' expectations for an increase of 1.2 million barrels. Crude stocks at the Cushing, Oklahoma, delivery hub fell by 1.906 million barrels, EIA said. The withdrawal was the biggest draw at Cushing since February, 2014.
Gasoline stocks rose by 2.8 million barrels, compared with analysts' expectations in a Reuters poll for a 21,000-barrel decrease.
John Kilduff, founding partner at Again Capital, said the EIA report was modestly bullish, but did not justify such a large move.
Potentially boosting oil, said Kilduff, was testimony from U.S. CENTCOM Commander General Lloyd Austin confirming that U.S. Special Operations Forces troops are now on the ground in Syria assisting Kurdish forces in their fight against the Islamic State and other insurgents.
Reports of Russian troop activity in Syria have already added a few dollars to the price of oil, he said, noting that the country's civil war is attracting more attention in light of a worsening migrant crisis.
Global stock markets rose ahead of a U.S. Fed two-day session to decide whether to raise rates for the first time in a decade.
Higher U.S. interest rates would likely attract cash from money traders, lifting the dollar. That could be bearish for oil markets as it would raise prices for holders of other currencies.
The prospect of falling U.S. oil production as prices skim six-year lows has narrowed the gap between benchmark U.S. and Brent crude futures.
The Brent-WTI spread between the two prompt months shrank on Tuesday to around $1.45 a barrel, the narrowest since January, when WTI briefly cost more than Brent. The spread was around $2.68 on Wednesday.
"We believe that this could be the market's reaction to the decline in U.S. crude production (drilling) ... further exacerbated as Iranian crude could be entering the market, which puts heavy pressure on the global benchmark (Brent)," said Daniel Ang, analyst at Singapore-based Phillip Futures.
Iranian crude stored in tankers could quickly enter world markets once sanctions against Tehran are
Oil prices have fallen by almost 60 percent since June 2014 on concerns about oversupply and slowing Asian demand, factors that continue to weigh on prices.
Gasoline
Orçun Tezel
· 1
Orcun Tezel
OPEC ready to talk, boosting oil prices...
Oil prices surged Monday, capping their biggest three-day gain in 25 years, as the Organization of Petroleum Exporting Countries suggested it may be ready to scale back output and the government cut its estimates of U.S. oil production.
OPEC said in an article that it "stands ready to talk to all other producers" to achieve "fair and reasonable prices." In its monthly OPEC Bulletin, the cartel added, "But this has to be a level playing field. OPEC will protect its own interests."
Though the article, headlined "Cooperation holds the key to oil's future," does not spell out how the discussion would go, the focus would clearly be on how to moderate production levels in a way to drive up prices, which fell below $40 a barrel this month.
As word spread that OPEC is ready to deal, oil prices rebounded Monday. U.S. crude prices rose $3.98, almost 9%, to settle at $49.20 a barrel in New York. Prices are up 28% since Thursday. Bloomberg says it was the biggest three-day gain in 25 years. Brent crude, the international standard, was up $3.61 to $53.60.
A sustained rise in oil prices could prop up gasoline prices, which are expected to fall in coming months after the end of the summer driving season and current refinery maintenance that has limited supplies.
Independent oil analyst Philip Verleger says the article doesn't reflect Saudi Arabia's plans to pump oil at full throttle. The country, he says, can make a profit as long as oil is above its costs of $3 to $5 a barrel, and it's intent on driving some producers — in Canada, Venezuela or the USA — out of business. "OPEC is irrelevant," he says.
A bigger factor in the price jump, he says, is that the Energy Information Administration trimmed its estimate of U.S. production from January to May by 40,000 to 130,000 barrels per day. It cut its estimate of June output by 100,000 barrels a day.
"We're producing a lot less oil than we thought we were," Verleger says. He says Monday's report corroborates suspicions that the government has overstated U.S. output even as producers have shut down drilling rigs this year amid falling prices.
After peaking at 9.5 million barrels a day in April, research firm Genscape says, U.S. output is poised to fall to 8.6 million barrels per day by July 2016.
Tom Kloza, chief global analyst at the Oil Price Information Service, says Monday's gains were probably driven in part by traders looking to hedge their previous bets on falling prices. "This does not mean this is a new bull market for oil," he says, noting supplies remain abundant while global demand has weakened.
Even as oil prices have fallen in the short run, OPEC is looking to factors that might push them higher in the future. It is betting that lower prices are going to encourage consumers around the world to use more oil, as happened when an oil price bust and subsequent lower gasoline prices coaxed many Americans into buying SUVs and more fuel-thirsty vehicles in the 1990s. In recent years, consumers in emerging nations have been buying their first cars, boosting demand for oil.
Indeed, OPEC says its projections show that world oil demand will rise 1.38 million barrels a day this year compared with 2014 to 92.7 million barrels a day, mostly because of higher demand in the resurgent economies of the USA and Europe. In 2016, it says demand will increase an additional 1.34 million barrels a day.
That may not be enough to keep pace with abundant supplies. The emergence of the USA as a major player when it comes to oil production again and tough mandates on fuel economy of U.S. vehicles to curb greenhouse gases — no matter the price of gas — are factors that complicate matters for OPEC when it comes to encouraging higher prices.
Gasoline
Orçun Tezel
Oil prices surged Monday, capping their biggest three-day gain in 25 years, as the Organization of Petroleum Exporting Countries suggested it may be ready to scale back output and the government cut its estimates of U.S. oil production.
OPEC said in an article that it "stands ready to talk to all other producers" to achieve "fair and reasonable prices." In its monthly OPEC Bulletin, the cartel added, "But this has to be a level playing field. OPEC will protect its own interests."
Though the article, headlined "Cooperation holds the key to oil's future," does not spell out how the discussion would go, the focus would clearly be on how to moderate production levels in a way to drive up prices, which fell below $40 a barrel this month.
As word spread that OPEC is ready to deal, oil prices rebounded Monday. U.S. crude prices rose $3.98, almost 9%, to settle at $49.20 a barrel in New York. Prices are up 28% since Thursday. Bloomberg says it was the biggest three-day gain in 25 years. Brent crude, the international standard, was up $3.61 to $53.60.
A sustained rise in oil prices could prop up gasoline prices, which are expected to fall in coming months after the end of the summer driving season and current refinery maintenance that has limited supplies.
Independent oil analyst Philip Verleger says the article doesn't reflect Saudi Arabia's plans to pump oil at full throttle. The country, he says, can make a profit as long as oil is above its costs of $3 to $5 a barrel, and it's intent on driving some producers — in Canada, Venezuela or the USA — out of business. "OPEC is irrelevant," he says.
A bigger factor in the price jump, he says, is that the Energy Information Administration trimmed its estimate of U.S. production from January to May by 40,000 to 130,000 barrels per day. It cut its estimate of June output by 100,000 barrels a day.
"We're producing a lot less oil than we thought we were," Verleger says. He says Monday's report corroborates suspicions that the government has overstated U.S. output even as producers have shut down drilling rigs this year amid falling prices.
After peaking at 9.5 million barrels a day in April, research firm Genscape says, U.S. output is poised to fall to 8.6 million barrels per day by July 2016.
Tom Kloza, chief global analyst at the Oil Price Information Service, says Monday's gains were probably driven in part by traders looking to hedge their previous bets on falling prices. "This does not mean this is a new bull market for oil," he says, noting supplies remain abundant while global demand has weakened.
Even as oil prices have fallen in the short run, OPEC is looking to factors that might push them higher in the future. It is betting that lower prices are going to encourage consumers around the world to use more oil, as happened when an oil price bust and subsequent lower gasoline prices coaxed many Americans into buying SUVs and more fuel-thirsty vehicles in the 1990s. In recent years, consumers in emerging nations have been buying their first cars, boosting demand for oil.
Indeed, OPEC says its projections show that world oil demand will rise 1.38 million barrels a day this year compared with 2014 to 92.7 million barrels a day, mostly because of higher demand in the resurgent economies of the USA and Europe. In 2016, it says demand will increase an additional 1.34 million barrels a day.
That may not be enough to keep pace with abundant supplies. The emergence of the USA as a major player when it comes to oil production again and tough mandates on fuel economy of U.S. vehicles to curb greenhouse gases — no matter the price of gas — are factors that complicate matters for OPEC when it comes to encouraging higher prices.
Gasoline
Orçun Tezel
· 1
Orcun Tezel
Gasoline prices shoot up again
YOUNGSTOWN, Ohio (WKBN) – Those below $2 gas prices didn’t last long. A problem at a large refinery in Indiana is behind soaring gas prices in the Midwest, including here in the Mahoning Valley.
Prices at some gas stations are up as much as 60-cents a gallon since Tuesday. That got more than a few of you to call or message the WKBN newsroom.
An important piece of equipment at the BP Refinery in Whiting, Indiana is shut down and repairs there could take a month. Many gasoline companies get at least some of their fuel from that plant.
The AAA daily survey had the average price for regular in the Youngstown-Warren market at $2.51 a gallon on Wednesday morning. That’s an increase of 25-cents from Tuesday when prices reached a seasonal low.
The Gas Buddy website showed prices as high as $2.90 on Thursday morning in Boardman and Canfield. $2.50 was a pretty good price, if you can find it.
We still have the lowest prices in Ohio. The AAA average in Cincinnati and Dayton was $2.84.
Gasoline
Orçun Tezel
YOUNGSTOWN, Ohio (WKBN) – Those below $2 gas prices didn’t last long. A problem at a large refinery in Indiana is behind soaring gas prices in the Midwest, including here in the Mahoning Valley.
Prices at some gas stations are up as much as 60-cents a gallon since Tuesday. That got more than a few of you to call or message the WKBN newsroom.
An important piece of equipment at the BP Refinery in Whiting, Indiana is shut down and repairs there could take a month. Many gasoline companies get at least some of their fuel from that plant.
The AAA daily survey had the average price for regular in the Youngstown-Warren market at $2.51 a gallon on Wednesday morning. That’s an increase of 25-cents from Tuesday when prices reached a seasonal low.
The Gas Buddy website showed prices as high as $2.90 on Thursday morning in Boardman and Canfield. $2.50 was a pretty good price, if you can find it.
We still have the lowest prices in Ohio. The AAA average in Cincinnati and Dayton was $2.84.
Gasoline
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Orcun Tezel
Gasoline prices continue downward trend
Average retail gasoline prices in the Twin Cities have fallen 9.4 cents per gallon in the past week, averaging $2.50 per gallon Sunday, according to GasBuddy's daily survey of 1,106 gas outlets in the Twin Cities. This compares with the national average that has fallen 5.4 cents per gallon in the last week to $2.60 per gallon, according to gasoline price website GasBuddy.com.
Including the change in gasoline prices in the Twin Cities during the past week, prices yesterday were 88.2 cents per gallon lower than the same day one year ago and are 17 cents per gallon lower than a month ago. The national average has decreased 16.2 cents per gallon during the last month and stands 87.9 cents per gallon lower than this day one year ago.
"The powerful combination of declining crude oil prices and robust production from U.S. refineries continues to pummel retail gasoline prices nationwide and it's a trend we expect to continue," said Patrick DeHaan, senior petroleum analyst with GasBuddy. "With West Texas Intermediate slipping to $43.75 per barrel on Friday and refineries exceeding 17 million barrels per day in each of the past four weeks, a level that hasn't been reached since the Energy Information Administration began publishing the data in 1990, that explains why the national average price of gas shed 6 cents per gallon in the past week," DeHaan noted.
"Even with the extraordinary price spikes in California earlier this summer that inflated the national average, improving conditions there have brought the state average from its mid-July peak at $3.90 down to $3.60 today and that average is 31 cents less than what Californians were looking at last year," added Gregg Laskoski, another senior petroleum analyst with GasBuddy. "Overall Americans are paying 88 cents per gallon less than what we were paying a year ago and some states like Indiana and Kentucky are saving more than $1 gallon versus last year at this time."
Gasoline
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Average retail gasoline prices in the Twin Cities have fallen 9.4 cents per gallon in the past week, averaging $2.50 per gallon Sunday, according to GasBuddy's daily survey of 1,106 gas outlets in the Twin Cities. This compares with the national average that has fallen 5.4 cents per gallon in the last week to $2.60 per gallon, according to gasoline price website GasBuddy.com.
Including the change in gasoline prices in the Twin Cities during the past week, prices yesterday were 88.2 cents per gallon lower than the same day one year ago and are 17 cents per gallon lower than a month ago. The national average has decreased 16.2 cents per gallon during the last month and stands 87.9 cents per gallon lower than this day one year ago.
"The powerful combination of declining crude oil prices and robust production from U.S. refineries continues to pummel retail gasoline prices nationwide and it's a trend we expect to continue," said Patrick DeHaan, senior petroleum analyst with GasBuddy. "With West Texas Intermediate slipping to $43.75 per barrel on Friday and refineries exceeding 17 million barrels per day in each of the past four weeks, a level that hasn't been reached since the Energy Information Administration began publishing the data in 1990, that explains why the national average price of gas shed 6 cents per gallon in the past week," DeHaan noted.
"Even with the extraordinary price spikes in California earlier this summer that inflated the national average, improving conditions there have brought the state average from its mid-July peak at $3.90 down to $3.60 today and that average is 31 cents less than what Californians were looking at last year," added Gregg Laskoski, another senior petroleum analyst with GasBuddy. "Overall Americans are paying 88 cents per gallon less than what we were paying a year ago and some states like Indiana and Kentucky are saving more than $1 gallon versus last year at this time."
Gasoline
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Orcun Tezel
U.A.E. Raises Gasoline Prices as OPEC Member Halts Subsidies
The United Arab Emirates, OPEC’s third-biggest producer, will raise unleaded gasoline prices by 24 percent next month when it becomes the first country in the oil-rich Persian Gulf to remove subsidies on transport fuel.
Motorists will pay 2.14 dirhams per liter (58 cents) for 95-octane unleaded gasoline starting Aug. 1 as the country deregulates fuel prices, the official WAM news agency reported Tuesday. The gasoline grade currently sells for 1.72 dirhams per liter, according to the Ministry of Energy’s website.
“It does seem to be one of the more ambitious reforms within the Gulf countries to tackle the impact of lower oil prices,” said William Jackson, senior emerging markets economist at Capital Economics Ltd. in London. “The U.A.E. is strong to start off, so this may just reassure investors that its fiscal position is unlikely to deteriorate badly any time soon.”
Gasoline is now subsidized in the U.A.E., the second-biggest Arab economy and home to about 6 percent of global oil reserves. Gulf members of the Organization of Petroleum Exporting Countries provide some of the largest per capita energy subsidies in the world, according to the International Monetary Fund. The payments have cost U.A.E. state energy companies about $1 billion a year over the last decade, Energy Minister Suhail Al Mazrouei said in February.
‘Sure Footing’
“U.A.E. drivers have enjoyed unusually low fuel prices for decades,” the Dubai-based Gulf News said in an editorial Wednesday. “But long-term government subsidies are not good for any economy, and the new system puts the country on a more sure footing.”
Oil extended declines Wednesday amid signs producers will continue adding supplies to a global glut. Brent crude, which fell more than 50 percent in the last 12 months, lost as much as 79 cents and was at $52.74 a barrel in London.
The energy ministry set prices for 98-octane unleaded gasoline at 2.25 dirhams per liter and 91-octane grade at 2.07 dirhams per liter, WAM reported. Prices for diesel will drop 29 percent to 2.05 dirhams per liter, it said.
“I pay 99 dirhams for a full tank and it lasts a week, now it will definitely be 130 dirhams,” said Kavitha Ponnambalam, a banking saleswoman, as she filled up her Ford Escape SUV at an Emirates National Oil Co. gas station in Dubai. “That will really hit my budget.”
Daily Reviews
Cheaper diesel will reduce costs for industry, shipping and cargo, said Matar Alneyadi, head of the ministry’s Price Review Committee, according to WAM. The committee will review fuel prices on a daily basis and announce them on the 28th day of each month, he said.
The current U.S. price for premium unleaded gasoline is $3.15 a gallon, or 83 cents a liter, according to AAA, the biggest U.S. auto group. That compares with 26 cents in Qatar and 21 cents in Kuwait, both of them OPEC members, and 15 cents in Saudi Arabia, the group’s largest producer, according to data compiled by GlobalPetrolPrices.com. The worldwide average price for gasoline is $1.10 a liter, the data show.
The U.A.E., which doesn’t levy income or value-added taxes, comprises seven sheikhdoms including Abu Dhabi and Dubai, the Gulf business hub. Expatriates number about 80 percent of the country’s residents. Removal of fuel subsidies is part of the government’s plan to make the economy more competitive and diversify sources of income, Al Mazrouei said in a July 22 statement.
Impact ‘Minimal’
The increase in gasoline prices will have “minimal” impact on individual motorists, said Alneyadi of the Price Review Committee. “It will promote rationalized consumption and incentivize people to choose most fuel-efficient cars, while curbing the increase in the number of cars on the country’s roads.”
For Shaukat Mahmoud, a Pakistani living in Dubai for 13 years, costlier gasoline will mean less purchasing power. “I’m worried,” he said at the ENOC gas station. “I have family at home. I earn money to feed them and fulfill their needs. Now there will be less money for them. It will affect me.”
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The United Arab Emirates, OPEC’s third-biggest producer, will raise unleaded gasoline prices by 24 percent next month when it becomes the first country in the oil-rich Persian Gulf to remove subsidies on transport fuel.
Motorists will pay 2.14 dirhams per liter (58 cents) for 95-octane unleaded gasoline starting Aug. 1 as the country deregulates fuel prices, the official WAM news agency reported Tuesday. The gasoline grade currently sells for 1.72 dirhams per liter, according to the Ministry of Energy’s website.
“It does seem to be one of the more ambitious reforms within the Gulf countries to tackle the impact of lower oil prices,” said William Jackson, senior emerging markets economist at Capital Economics Ltd. in London. “The U.A.E. is strong to start off, so this may just reassure investors that its fiscal position is unlikely to deteriorate badly any time soon.”
Gasoline is now subsidized in the U.A.E., the second-biggest Arab economy and home to about 6 percent of global oil reserves. Gulf members of the Organization of Petroleum Exporting Countries provide some of the largest per capita energy subsidies in the world, according to the International Monetary Fund. The payments have cost U.A.E. state energy companies about $1 billion a year over the last decade, Energy Minister Suhail Al Mazrouei said in February.
‘Sure Footing’
“U.A.E. drivers have enjoyed unusually low fuel prices for decades,” the Dubai-based Gulf News said in an editorial Wednesday. “But long-term government subsidies are not good for any economy, and the new system puts the country on a more sure footing.”
Oil extended declines Wednesday amid signs producers will continue adding supplies to a global glut. Brent crude, which fell more than 50 percent in the last 12 months, lost as much as 79 cents and was at $52.74 a barrel in London.
The energy ministry set prices for 98-octane unleaded gasoline at 2.25 dirhams per liter and 91-octane grade at 2.07 dirhams per liter, WAM reported. Prices for diesel will drop 29 percent to 2.05 dirhams per liter, it said.
“I pay 99 dirhams for a full tank and it lasts a week, now it will definitely be 130 dirhams,” said Kavitha Ponnambalam, a banking saleswoman, as she filled up her Ford Escape SUV at an Emirates National Oil Co. gas station in Dubai. “That will really hit my budget.”
Daily Reviews
Cheaper diesel will reduce costs for industry, shipping and cargo, said Matar Alneyadi, head of the ministry’s Price Review Committee, according to WAM. The committee will review fuel prices on a daily basis and announce them on the 28th day of each month, he said.
The current U.S. price for premium unleaded gasoline is $3.15 a gallon, or 83 cents a liter, according to AAA, the biggest U.S. auto group. That compares with 26 cents in Qatar and 21 cents in Kuwait, both of them OPEC members, and 15 cents in Saudi Arabia, the group’s largest producer, according to data compiled by GlobalPetrolPrices.com. The worldwide average price for gasoline is $1.10 a liter, the data show.
The U.A.E., which doesn’t levy income or value-added taxes, comprises seven sheikhdoms including Abu Dhabi and Dubai, the Gulf business hub. Expatriates number about 80 percent of the country’s residents. Removal of fuel subsidies is part of the government’s plan to make the economy more competitive and diversify sources of income, Al Mazrouei said in a July 22 statement.
Impact ‘Minimal’
The increase in gasoline prices will have “minimal” impact on individual motorists, said Alneyadi of the Price Review Committee. “It will promote rationalized consumption and incentivize people to choose most fuel-efficient cars, while curbing the increase in the number of cars on the country’s roads.”
For Shaukat Mahmoud, a Pakistani living in Dubai for 13 years, costlier gasoline will mean less purchasing power. “I’m worried,” he said at the ENOC gas station. “I have family at home. I earn money to feed them and fulfill their needs. Now there will be less money for them. It will affect me.”
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Don’t Add Oil! Hong Kong gasoline prices the highest in the world
Do you sometimes wonder how you cope with the MTR? This is how.
Statistics published by Global Petrol Prices show that this month, Hong Kong has the highest gasoline prices in the world at HKD15.19 a litre, coming second to only Norway (at HKD15.58) for all of Q2.
Gas prices in Hong Kong were at HKD14.89 per litre on April 13 but steadily rose to HKD15.2 per litre by July 20, peaking from June 15 to 22 at HKD15.54.
For a comparison, the average price of gasoline in the world per litre during that same time period was HKD11.13.
Currently trailing Hong Kong in gasoline prices are Norway at HKD15.14 per litre, the Netherlands at HKD14.81 per litre, Italy at HKD14.14 per litre and the UK at HKD14.07 per litre.
It’s a good job only the rich drive here, we suppose.
Do you sometimes wonder how you cope with the MTR? This is how.
Statistics published by Global Petrol Prices show that this month, Hong Kong has the highest gasoline prices in the world at HKD15.19 a litre, coming second to only Norway (at HKD15.58) for all of Q2.
Gas prices in Hong Kong were at HKD14.89 per litre on April 13 but steadily rose to HKD15.2 per litre by July 20, peaking from June 15 to 22 at HKD15.54.
For a comparison, the average price of gasoline in the world per litre during that same time period was HKD11.13.
Currently trailing Hong Kong in gasoline prices are Norway at HKD15.14 per litre, the Netherlands at HKD14.81 per litre, Italy at HKD14.14 per litre and the UK at HKD14.07 per litre.
It’s a good job only the rich drive here, we suppose.
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United Arab Emirates to nix subsidized gasoline prices
Officials in United Arab Emirates plan to get rid of subsidized prices for gasoline and bring prices in line with international rates.
Global oil prices have remained fairly low for most of this year, which should be good news for people in most of the industrialized world.
But that's not the case in the oil-rich United Arab Emirates.
The continued slump in prices has prodded the seven-state federation to make a somewhat radical change in policy.
Recommended: Think you're a car buff? Take the quiz.
U.A.E. officials plan to scrap subsidized price controls on gasoline, and bring prices in line with international rates, says the Associated Press (via U.S. News & World Report).
TEST YOUR KNOWLEDGE Think you're a car buff? Take the quiz.
The move by the country's Energy Ministry was viewed as a surprise, and comes as the second-largest Arab economy continues to be affected by low oil prices.
Officials plan to begin linking local fuel prices to global prices beginning August 1.
Prices are currently set by the government at subsidized rates. Right now the average price of gasoline in the U.A.E. is equivalent to about $1.78 per gallon.
That's still much higher than average prices in other Arab countries, though.
Gas is priced at roughly 60 cents per gallon in neighboring Saudi Arabia, the report says.
A government committee will still meet once a month to set prices for the following month, but using international prices as a guide.
Energy Minister Suhail al-Mazroui said the change in policy could help lower fuel consumption and encourage more people to use public transportation.
The oil-rich country hasn't been a particularly strong advocate of decreased fuel use in the past--although it has found ways to profit off that impulse.
Abu Dhabi National Energy Co.--75 percent owned by the government of the U.A.E. capital--once had a seven-percent stake in Tesla Motors, which it sold in 2012 and made $113 million.
It will be interesting to see if the national government reverses its subsidy policy when international oil prices increase again.
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Officials in United Arab Emirates plan to get rid of subsidized prices for gasoline and bring prices in line with international rates.
Global oil prices have remained fairly low for most of this year, which should be good news for people in most of the industrialized world.
But that's not the case in the oil-rich United Arab Emirates.
The continued slump in prices has prodded the seven-state federation to make a somewhat radical change in policy.
Recommended: Think you're a car buff? Take the quiz.
U.A.E. officials plan to scrap subsidized price controls on gasoline, and bring prices in line with international rates, says the Associated Press (via U.S. News & World Report).
TEST YOUR KNOWLEDGE Think you're a car buff? Take the quiz.
The move by the country's Energy Ministry was viewed as a surprise, and comes as the second-largest Arab economy continues to be affected by low oil prices.
Officials plan to begin linking local fuel prices to global prices beginning August 1.
Prices are currently set by the government at subsidized rates. Right now the average price of gasoline in the U.A.E. is equivalent to about $1.78 per gallon.
That's still much higher than average prices in other Arab countries, though.
Gas is priced at roughly 60 cents per gallon in neighboring Saudi Arabia, the report says.
A government committee will still meet once a month to set prices for the following month, but using international prices as a guide.
Energy Minister Suhail al-Mazroui said the change in policy could help lower fuel consumption and encourage more people to use public transportation.
The oil-rich country hasn't been a particularly strong advocate of decreased fuel use in the past--although it has found ways to profit off that impulse.
Abu Dhabi National Energy Co.--75 percent owned by the government of the U.A.E. capital--once had a seven-percent stake in Tesla Motors, which it sold in 2012 and made $113 million.
It will be interesting to see if the national government reverses its subsidy policy when international oil prices increase again.
Gasoline
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EIA: U.S. Crude Oil Stocks Rise; Gasoline Drops
Crude oil inventories rose by 2.5 million barrels
U.S. crude stockpiles and distillates rose, while gasoline inventories fell in the week ending July 17, according to data released Wednesday by the U.S. Energy Information Administration.
Crude oil inventories rose by 2.5 million barrels, compared to a drop of 1.6 million barrels expected by analysts surveyed by The Wall Street Journal. Oil inventories are at 463.9 million barrels, near levels not seen for this time of year in at least the last 80 years, according to the EIA.
Gasoline stockpiles fell 1.7 million barrels from an expected rise by 600,000 barrels according to the survey.
Distillate stocks, which include heating oil and diesel fuel, rose by 200,000 barrels, less than the expected 2 million-barrel weekly increase.
Refining capacity utilization rose 0.2 percentage point to 95.5%, the highest level so far this year. Analysts had predicted the operating rate would be unchanged from the previous week.
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Crude oil inventories rose by 2.5 million barrels
U.S. crude stockpiles and distillates rose, while gasoline inventories fell in the week ending July 17, according to data released Wednesday by the U.S. Energy Information Administration.
Crude oil inventories rose by 2.5 million barrels, compared to a drop of 1.6 million barrels expected by analysts surveyed by The Wall Street Journal. Oil inventories are at 463.9 million barrels, near levels not seen for this time of year in at least the last 80 years, according to the EIA.
Gasoline stockpiles fell 1.7 million barrels from an expected rise by 600,000 barrels according to the survey.
Distillate stocks, which include heating oil and diesel fuel, rose by 200,000 barrels, less than the expected 2 million-barrel weekly increase.
Refining capacity utilization rose 0.2 percentage point to 95.5%, the highest level so far this year. Analysts had predicted the operating rate would be unchanged from the previous week.
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Gasoline, eggs lift U.S. consumer prices in June
WASHINGTON, July 17 (Reuters) - U.S. consumer prices rose for a fifth straight month in June as the cost of gasoline and a range of other goods increased, further signs of firming inflation that strengthen the case for an interest rate hike this year.
The Labor Department said on Friday its Consumer Price Index rose 0.3 percent last month after increasing 0.4 percent in May. Last month's increase pushed the year-on-year CPI rate into positive territory for the first time since December.
The energy-driven disinflationary trend appears to have run its course. A report on Wednesday showed producer prices rose in
June for a second straight month. Firming price pressures, together with a tightening labor market and strengthening housing could give the Fed confidence that inflation will gradually rise toward its 2 percent target.
Fed Chair Janet Yellen this week affirmed the U.S. central bank was keen to start tightening monetary policy later this year after keeping its short-term interest rate near zero for more than six years.
In the 12 months through June, the CPI edged up 0.1 percent after being unchanged in May. Economists polled by Reuters had forecast the CPI rising 0.3 percent from May and gaining 0.1 percent from a year ago.
The so-called core CPI, which strips out food and energy costs, increased 0.2 percent last month after rising 0.1 percent in May. Underlying inflation pressures have been tamed by a strong dollar.
In the 12 months through June, the core CPI rose 1.8 percent after May's 1.7 percent increase.
Last month, gasoline prices rose 3.4 percent after jumping 10.4 percent in May. Food prices rose 0.3 percent, the largest increase since September 2014, as an outbreak of bird flu in some parts of the country causes a shortage of eggs. Egg prices surged 18.3 percent, the biggest gain since August 1973.
Elsewhere, the index for rent increased 0.4 percent, the largest rise since August 2013. With the residential vacancy rate near a 22-year low as a firming labor market boosts household formation, shelter costs are likely to continue rising.
There were also increases in the cost of recreation, new motor vehicles, tobacco, airline fares and personal care. These offset declines in the prices for apparel, medical care, used cars and trucks and household furnishings.
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WASHINGTON, July 17 (Reuters) - U.S. consumer prices rose for a fifth straight month in June as the cost of gasoline and a range of other goods increased, further signs of firming inflation that strengthen the case for an interest rate hike this year.
The Labor Department said on Friday its Consumer Price Index rose 0.3 percent last month after increasing 0.4 percent in May. Last month's increase pushed the year-on-year CPI rate into positive territory for the first time since December.
The energy-driven disinflationary trend appears to have run its course. A report on Wednesday showed producer prices rose in
June for a second straight month. Firming price pressures, together with a tightening labor market and strengthening housing could give the Fed confidence that inflation will gradually rise toward its 2 percent target.
Fed Chair Janet Yellen this week affirmed the U.S. central bank was keen to start tightening monetary policy later this year after keeping its short-term interest rate near zero for more than six years.
In the 12 months through June, the CPI edged up 0.1 percent after being unchanged in May. Economists polled by Reuters had forecast the CPI rising 0.3 percent from May and gaining 0.1 percent from a year ago.
The so-called core CPI, which strips out food and energy costs, increased 0.2 percent last month after rising 0.1 percent in May. Underlying inflation pressures have been tamed by a strong dollar.
In the 12 months through June, the core CPI rose 1.8 percent after May's 1.7 percent increase.
Last month, gasoline prices rose 3.4 percent after jumping 10.4 percent in May. Food prices rose 0.3 percent, the largest increase since September 2014, as an outbreak of bird flu in some parts of the country causes a shortage of eggs. Egg prices surged 18.3 percent, the biggest gain since August 1973.
Elsewhere, the index for rent increased 0.4 percent, the largest rise since August 2013. With the residential vacancy rate near a 22-year low as a firming labor market boosts household formation, shelter costs are likely to continue rising.
There were also increases in the cost of recreation, new motor vehicles, tobacco, airline fares and personal care. These offset declines in the prices for apparel, medical care, used cars and trucks and household furnishings.
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Gasoline Could Reach $2 Per Gallon by Christmas...
U.S. drivers can look forward to $2 gas later this year, thanks in part to the Iran nuclear deal announced Tuesday.
Gas may only dip a few cents when the Iranian oil first starts to flow again, but by September drivers could see big savings.
“Once we get past Labor Day, we should see gas falling by 10 to 15 cents a month,” said Tom Kloza, chief oil analyst with the Oil Price Information Service. “By December a lot of places are going to see gasoline at $2 or less.”
Iran hasn’t been able to sell oil to the United States since 1995. Most major Western countries imposed sanctions within the last five years aimed at curbing Iran’s nuclear program. Instead it’s been selling to China, India, Turkey and other developing markets.
Crude oil and gasoline prices were both initially lower Tuesday on news of a deal between six major powers and Iran, though oil edged higher later.
“[Iran] will only add to the oil glut on the market and increase the selling pressure,” wrote Naeem Aslam, chief market analyst at Ava Trade.
The details of how sanctions will be lifted is not yet known. Some critics in Congress want to keep U.S. sanctions in place, but President Obama has vowed to veto any such efforts. And even if U.S. sanctions do stay in place for a while, the flow of Iranian oil to Europe will push down prices in global oil markets.
Iran could add as much as 500,000 barrels of oil per day to worldwide markets by the end of this year, according to experts at a recent Credit Suisse conference on Iranian sanctions and oil. The International Energy Agency estimates Iran could add as much as 800,000 barrels a day months after sanctions are lifted. Another 30 million barrels of Iranian crude are estimated to be in storage and ready for sale, according to FACTS Global Energy, an industry consultancy.
The average gas price at U.S. stations is now $2.78 for a gallon of regular, according to AAA. Gas prices had fallen below $2 at most U.S. gas stations this past winter.
Even without Iranian oil, global production has been booming. North America, OPEC nations and record production from Russia and Iraq have been adding to a glut of oil on world markets. Economic problems in Europe and China also are curbing demand.
Kloza said Iran will add even more oil to the markets in 2016 as it improves its oil industry’s infrastructure, which has suffered under the sanctions.
Gasoline
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U.S. drivers can look forward to $2 gas later this year, thanks in part to the Iran nuclear deal announced Tuesday.
Gas may only dip a few cents when the Iranian oil first starts to flow again, but by September drivers could see big savings.
“Once we get past Labor Day, we should see gas falling by 10 to 15 cents a month,” said Tom Kloza, chief oil analyst with the Oil Price Information Service. “By December a lot of places are going to see gasoline at $2 or less.”
Iran hasn’t been able to sell oil to the United States since 1995. Most major Western countries imposed sanctions within the last five years aimed at curbing Iran’s nuclear program. Instead it’s been selling to China, India, Turkey and other developing markets.
Crude oil and gasoline prices were both initially lower Tuesday on news of a deal between six major powers and Iran, though oil edged higher later.
“[Iran] will only add to the oil glut on the market and increase the selling pressure,” wrote Naeem Aslam, chief market analyst at Ava Trade.
The details of how sanctions will be lifted is not yet known. Some critics in Congress want to keep U.S. sanctions in place, but President Obama has vowed to veto any such efforts. And even if U.S. sanctions do stay in place for a while, the flow of Iranian oil to Europe will push down prices in global oil markets.
Iran could add as much as 500,000 barrels of oil per day to worldwide markets by the end of this year, according to experts at a recent Credit Suisse conference on Iranian sanctions and oil. The International Energy Agency estimates Iran could add as much as 800,000 barrels a day months after sanctions are lifted. Another 30 million barrels of Iranian crude are estimated to be in storage and ready for sale, according to FACTS Global Energy, an industry consultancy.
The average gas price at U.S. stations is now $2.78 for a gallon of regular, according to AAA. Gas prices had fallen below $2 at most U.S. gas stations this past winter.
Even without Iranian oil, global production has been booming. North America, OPEC nations and record production from Russia and Iraq have been adding to a glut of oil on world markets. Economic problems in Europe and China also are curbing demand.
Kloza said Iran will add even more oil to the markets in 2016 as it improves its oil industry’s infrastructure, which has suffered under the sanctions.
Gasoline
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Nigeria to produce at least 20pc of its gasoline needs
Major crude oil producer Nigeria aims to overcome its chaotic and crumbling refining sector to produce at least a fraction of the gasoline it needs to use itself.
Its state oil company hopes that domestic plants can cover 20 percent of Nigeria's gasoline needs, the head of refining told Reuters.
President Muhammadu Buhari, who oversaw much of the refining system's development, is keen to reduce reliance on costly and graft-ridden subsidised imports.
Ian Udoh, the group executive director of refining and petrochemicals, said that he expected to receive six cargoes a month of Nigerian Bonny Light and Escravos crude oil to run 180,000 barrels per day (bpd) or 40 percent, of Nigeria's total refining capacity.
He expected to produce 8 million litres a day of gasoline, accounting for about 20 percent of Nigeria's estimated consumption.
During the last eight months, no crude was sent to the refineries, said the company contracted to deliver the oil. A government document also showed that the deliveries stopped last year but a month earlier, in October.
Nigeria has wholly depended on subsidised fuel imports and crude-for-product swap agreements and suffered acute fuel shortages in May.
The government's anti-corruption and security services are investigating the intricate structure of oil swaps deals. The crude in those contracts is taken out of the domestic allocation.
Due to the dilapidation of pipeline infrastructure, refineries depend on sea deliveries. Since 2011, Nigeria based PPP Fluid Mechanics Ltd has been delivering crude for the state Nigerian National Petroleum Corp and an official there said no explanation was given for the supply halt.
"We were contracted to deliver 1.65 million barrels a month to Warri and 3.12 million barrels to Port Harcourt," the official at PPP Fluid Mechanics said.
The 125,000 bpd Warri refinery resumed this week after maintenance and is expected to run at 60,000 bpd. The Port Harcourt complex will start ramping up over the next two weeks but only the newer of the two plants at the site is functional and at 90,000 bpd versus its 150,000 bpd capacity.
"What I hope is to run at this level and prove that we can add value...The restriction after this would be crude supply," Udoh said.
Nigeria's refineries have been neglected for years, operating sometimes just at 20 percent capacity, and did not even have functioning gasoline producing units at one point, Udoh said.
He added that up to $1 billion would be needed to replace just one of the key pipelines and an overhaul of the jetties was necessary to receive more vessels.
The last refinery to restart will be the northern Kaduna refinery as it will take about two more weeks to repair the pipeline bringing crude from the oil-rich delta in the south.
Gasoline
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Major crude oil producer Nigeria aims to overcome its chaotic and crumbling refining sector to produce at least a fraction of the gasoline it needs to use itself.
Its state oil company hopes that domestic plants can cover 20 percent of Nigeria's gasoline needs, the head of refining told Reuters.
President Muhammadu Buhari, who oversaw much of the refining system's development, is keen to reduce reliance on costly and graft-ridden subsidised imports.
Ian Udoh, the group executive director of refining and petrochemicals, said that he expected to receive six cargoes a month of Nigerian Bonny Light and Escravos crude oil to run 180,000 barrels per day (bpd) or 40 percent, of Nigeria's total refining capacity.
He expected to produce 8 million litres a day of gasoline, accounting for about 20 percent of Nigeria's estimated consumption.
During the last eight months, no crude was sent to the refineries, said the company contracted to deliver the oil. A government document also showed that the deliveries stopped last year but a month earlier, in October.
Nigeria has wholly depended on subsidised fuel imports and crude-for-product swap agreements and suffered acute fuel shortages in May.
The government's anti-corruption and security services are investigating the intricate structure of oil swaps deals. The crude in those contracts is taken out of the domestic allocation.
Due to the dilapidation of pipeline infrastructure, refineries depend on sea deliveries. Since 2011, Nigeria based PPP Fluid Mechanics Ltd has been delivering crude for the state Nigerian National Petroleum Corp and an official there said no explanation was given for the supply halt.
"We were contracted to deliver 1.65 million barrels a month to Warri and 3.12 million barrels to Port Harcourt," the official at PPP Fluid Mechanics said.
The 125,000 bpd Warri refinery resumed this week after maintenance and is expected to run at 60,000 bpd. The Port Harcourt complex will start ramping up over the next two weeks but only the newer of the two plants at the site is functional and at 90,000 bpd versus its 150,000 bpd capacity.
"What I hope is to run at this level and prove that we can add value...The restriction after this would be crude supply," Udoh said.
Nigeria's refineries have been neglected for years, operating sometimes just at 20 percent capacity, and did not even have functioning gasoline producing units at one point, Udoh said.
He added that up to $1 billion would be needed to replace just one of the key pipelines and an overhaul of the jetties was necessary to receive more vessels.
The last refinery to restart will be the northern Kaduna refinery as it will take about two more weeks to repair the pipeline bringing crude from the oil-rich delta in the south.
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Gasoline below $2 could return this fall if crude prices continue dropping
Posted on July 9, 2015 | By Associated Press PRINT
A slew of global economic and geopolitical factors are working to pummel the price of oil and set up U.S. drivers for very low gasoline prices later this year.
The price of U.S. crude dropped 7.7 percent Monday to close at $52.53 a barrel and is now down nearly 15 percent from the high for the year set on June 10.
Gasoline prices in the U.S. will likely slide somewhat from a national average of $2.77 over the next few weeks. Experts then expect a substantial decline in late summer and fall, pushing average gasoline prices in some low-price states below $2 a gallon again.
“We’re going back to some of those low numbers we saw over the winter,” said Tom Kloza, chief oil analyst at the Oil Price Information Service. “In some places (gas) prices starting with a 1 should come back by football season.”
There are several signs around the world that point to falling demand for crude and fuels at a time when supplies are high and possibly rising:
The Greek financial crisis could slow economic activity in Europe, which would reduce demand for gasoline and diesel.
China’s oil imports have already slipped this year and a plummeting Chinese stock market could mean even weaker demand in the world’s second largest oil consumer.
Oil production in OPEC, driven by strong production from Saudi Arabia and Iraq, is helping to keep the world’s supplies high. OPEC’s June production rose for the fourth month in a row, to 31.3 million barrels per day, according to a report Monday from Platts. That’s 1.3 million barrels per day more than the cartel’s official target and the highest level since August of 2012.
Iran is eager to begin exporting oil that has been held back by sanctions, and talks between the U.S. and Iran that could lift those sanctions appear to be progressing.
U.S. oil production remained strong even after drillers slowed their activity in the face of low oil prices — and now some drillers are ramping up production again.
The financial turmoil in Greece and China is also strengthening the dollar, which tends to push down the price of oil because oil is priced in dollars around the world.
“All signs point south for oil prices,” wrote Thomas Pugh, commodities economist at Capital Economics, in a report Monday. Pugh reduced his forecast for oil prices at the end of this year by $5 to $50 a barrel.
After hitting a six-year low of $43.46 in mid-March, oil rose to nearly $60 in late April as refiners processed enormous amounts of crude for the summer driving season. Oil then stayed remarkably stable around $60 until the middle of last week.
Then some key trends reversed: U.S. supplies increased for the first time in two months and the number of rigs drilling for oil in the U.S. grew for the first time since December. Oil fell 5 percent last week. And over the weekend the Greece crisis worsened and the Iranian talks progressed, leading to a further drop Monday.
Pump prices are unlikely to drop sharply right away because driving season is in full swing and U.S. gasoline demand is higher than it’s been since 2007, Kloza said. But unless a hurricane disrupts gasoline production on the Gulf Coast or elsewhere, gasoline prices should begin to plunge later this summer as refiners switch to winter blends of fuel.
The national average of $2.77 is 89 cents below last year at this time, according to AAA. In the first six months of the year AAA calculates that U.S. drivers saved $65 billion in gasoline expenses compared with the first six months of 2014, or $530 for every U.S. household on average.
Lower gasoline prices will help save drivers an additional $46 billion through the rest of the year, Kloza calculates.
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Posted on July 9, 2015 | By Associated Press PRINT
A slew of global economic and geopolitical factors are working to pummel the price of oil and set up U.S. drivers for very low gasoline prices later this year.
The price of U.S. crude dropped 7.7 percent Monday to close at $52.53 a barrel and is now down nearly 15 percent from the high for the year set on June 10.
Gasoline prices in the U.S. will likely slide somewhat from a national average of $2.77 over the next few weeks. Experts then expect a substantial decline in late summer and fall, pushing average gasoline prices in some low-price states below $2 a gallon again.
“We’re going back to some of those low numbers we saw over the winter,” said Tom Kloza, chief oil analyst at the Oil Price Information Service. “In some places (gas) prices starting with a 1 should come back by football season.”
There are several signs around the world that point to falling demand for crude and fuels at a time when supplies are high and possibly rising:
The Greek financial crisis could slow economic activity in Europe, which would reduce demand for gasoline and diesel.
China’s oil imports have already slipped this year and a plummeting Chinese stock market could mean even weaker demand in the world’s second largest oil consumer.
Oil production in OPEC, driven by strong production from Saudi Arabia and Iraq, is helping to keep the world’s supplies high. OPEC’s June production rose for the fourth month in a row, to 31.3 million barrels per day, according to a report Monday from Platts. That’s 1.3 million barrels per day more than the cartel’s official target and the highest level since August of 2012.
Iran is eager to begin exporting oil that has been held back by sanctions, and talks between the U.S. and Iran that could lift those sanctions appear to be progressing.
U.S. oil production remained strong even after drillers slowed their activity in the face of low oil prices — and now some drillers are ramping up production again.
The financial turmoil in Greece and China is also strengthening the dollar, which tends to push down the price of oil because oil is priced in dollars around the world.
“All signs point south for oil prices,” wrote Thomas Pugh, commodities economist at Capital Economics, in a report Monday. Pugh reduced his forecast for oil prices at the end of this year by $5 to $50 a barrel.
After hitting a six-year low of $43.46 in mid-March, oil rose to nearly $60 in late April as refiners processed enormous amounts of crude for the summer driving season. Oil then stayed remarkably stable around $60 until the middle of last week.
Then some key trends reversed: U.S. supplies increased for the first time in two months and the number of rigs drilling for oil in the U.S. grew for the first time since December. Oil fell 5 percent last week. And over the weekend the Greece crisis worsened and the Iranian talks progressed, leading to a further drop Monday.
Pump prices are unlikely to drop sharply right away because driving season is in full swing and U.S. gasoline demand is higher than it’s been since 2007, Kloza said. But unless a hurricane disrupts gasoline production on the Gulf Coast or elsewhere, gasoline prices should begin to plunge later this summer as refiners switch to winter blends of fuel.
The national average of $2.77 is 89 cents below last year at this time, according to AAA. In the first six months of the year AAA calculates that U.S. drivers saved $65 billion in gasoline expenses compared with the first six months of 2014, or $530 for every U.S. household on average.
Lower gasoline prices will help save drivers an additional $46 billion through the rest of the year, Kloza calculates.
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First woman pump attendan is in Turkey ..
Petrol Office provides a new professional opportunities for women , offering fuel to the aircraft by female personnel .
I had the chance to chat with her.
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Petrol Office provides a new professional opportunities for women , offering fuel to the aircraft by female personnel .
I had the chance to chat with her.
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Gasoline prices fall again in S.C.; still lowest in nation
The cost of gasoline continues its slow descent this summer.
The average price per gallon in South Carolina fell another 2 cents during the past week, down to $2.41 a gallon, according to gas price gauger GasBuddy’s daily survey Sunday of more than 3,000 gas outlets in the state.
The price is 3 cents lower than one month ago and about 94 cents less than one year ago. The Palmetto State continues to post the lowest gasoline prices in the U.S.
The national price of gasoline also dropped slightly by 0.6 cents per gallon last week to $2.77, according to GasBuddy.com. That’s up 1.2 cents per gallon during the past month and about 89 cents lower than the same say one year ago.
“From Los Angeles to Chicago to New York, motorists saw a promising trend at the pump this past weekend that continues to edge lower today,” said Gregg Laskoski, GasBuddy senior petroleum analyst. “That may run counter to consumer expectations, but this is what we’ve seen in recent years when summer prices showed nominal but gradual decline through June and July.”
He said retail gas prices follow the general direction of crude oil most of the time, and the U.S.’s benchmark crude, West Texas Intermediate, closed lower last week at $55.47 per barrel, well below the 2015 peak of $62 per barrel.
In South Carolina, the Charleston-North Charleston area posted the highest gasoline prices on Monday at $2.48 per gallon, according to AAA’s Daily Fuel Gauge Report. The Upstate recorded the lowest prices at $2.36 per gallon.
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The cost of gasoline continues its slow descent this summer.
The average price per gallon in South Carolina fell another 2 cents during the past week, down to $2.41 a gallon, according to gas price gauger GasBuddy’s daily survey Sunday of more than 3,000 gas outlets in the state.
The price is 3 cents lower than one month ago and about 94 cents less than one year ago. The Palmetto State continues to post the lowest gasoline prices in the U.S.
The national price of gasoline also dropped slightly by 0.6 cents per gallon last week to $2.77, according to GasBuddy.com. That’s up 1.2 cents per gallon during the past month and about 89 cents lower than the same say one year ago.
“From Los Angeles to Chicago to New York, motorists saw a promising trend at the pump this past weekend that continues to edge lower today,” said Gregg Laskoski, GasBuddy senior petroleum analyst. “That may run counter to consumer expectations, but this is what we’ve seen in recent years when summer prices showed nominal but gradual decline through June and July.”
He said retail gas prices follow the general direction of crude oil most of the time, and the U.S.’s benchmark crude, West Texas Intermediate, closed lower last week at $55.47 per barrel, well below the 2015 peak of $62 per barrel.
In South Carolina, the Charleston-North Charleston area posted the highest gasoline prices on Monday at $2.48 per gallon, according to AAA’s Daily Fuel Gauge Report. The Upstate recorded the lowest prices at $2.36 per gallon.
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Singapore's Hin Leong sells gasoline in surprise move...
* Hin Leong's participation in cash market adds liquidity
* Traders surprised by move but gasoline remains firm
* Gasoline still the star performer of oil products (Adds comments)
By Seng Li Peng and Jessica Jaganathan
SINGAPORE, July 6 (Reuters) - Singapore trader Hin Leong has sold 50,000 barrels of gasoline in the Singapore cash market, traders said on Monday, expressing surprise because the firm does not normally trade gasoline.
Hin Leong, which mainly trades fuel oil and middle distillates, sold the 92-octane grade gasoline cargo to Unipec at $73.60 a barrel.
The cargo is for July 26-30 loading from any ports in either Singapore or Malaysia approved by pricing agency Platts.
"I do not recall seeing Hin Leong in the gasoline cash market (before)," said a veteran oil trader based in Singapore.
The price for the cargo was the lowest fetched by a seller for a 92-octane grade in the Singapore cash window since April 15, likely due to a sharp drop in Brent crude prices.
"This came as a surprise but it adds to market liquidity," said a trader, referring to the sale.
Traders added that if Hin Leong continued to participate in the market, there would be more bid and offer options, depending on Hin Leong's position.
It was unclear why the family-owned firm, which also owns tanker fleets and a storage terminal, was moving into the gasoline market. It currently does not have any traders hired for the sole purpose of trading the motor fuel, traders said.
Gasoline is, however, experiencing an unusual bull run due to India's import spree following a supply shortfall caused by refinery maintenance.
State-owned Indian Oil Corp (IOC) has bought more than 500,000 tonnes of gasoline for March to July delivery while Hindustan Petroleum Corp Ltd (HPCL) has bought more than 200,000 tonnes of the fuel for May to July delivery.
China's growing demand has also affected its gasoline exports, traders said.
The outright price for gasoline, which used to be mostly below that of gasoil, has surpassed the price for benchmark 500ppm gasoil for most of this year due to demand. GO005-SIN GL92-SIN
As of July 6, the benchmark 92-octane gasoline price was at $73.60 a barrel versus gasoil 500ppm's price at $69.09 a barrel.
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* Hin Leong's participation in cash market adds liquidity
* Traders surprised by move but gasoline remains firm
* Gasoline still the star performer of oil products (Adds comments)
By Seng Li Peng and Jessica Jaganathan
SINGAPORE, July 6 (Reuters) - Singapore trader Hin Leong has sold 50,000 barrels of gasoline in the Singapore cash market, traders said on Monday, expressing surprise because the firm does not normally trade gasoline.
Hin Leong, which mainly trades fuel oil and middle distillates, sold the 92-octane grade gasoline cargo to Unipec at $73.60 a barrel.
The cargo is for July 26-30 loading from any ports in either Singapore or Malaysia approved by pricing agency Platts.
"I do not recall seeing Hin Leong in the gasoline cash market (before)," said a veteran oil trader based in Singapore.
The price for the cargo was the lowest fetched by a seller for a 92-octane grade in the Singapore cash window since April 15, likely due to a sharp drop in Brent crude prices.
"This came as a surprise but it adds to market liquidity," said a trader, referring to the sale.
Traders added that if Hin Leong continued to participate in the market, there would be more bid and offer options, depending on Hin Leong's position.
It was unclear why the family-owned firm, which also owns tanker fleets and a storage terminal, was moving into the gasoline market. It currently does not have any traders hired for the sole purpose of trading the motor fuel, traders said.
Gasoline is, however, experiencing an unusual bull run due to India's import spree following a supply shortfall caused by refinery maintenance.
State-owned Indian Oil Corp (IOC) has bought more than 500,000 tonnes of gasoline for March to July delivery while Hindustan Petroleum Corp Ltd (HPCL) has bought more than 200,000 tonnes of the fuel for May to July delivery.
China's growing demand has also affected its gasoline exports, traders said.
The outright price for gasoline, which used to be mostly below that of gasoil, has surpassed the price for benchmark 500ppm gasoil for most of this year due to demand. GO005-SIN GL92-SIN
As of July 6, the benchmark 92-octane gasoline price was at $73.60 a barrel versus gasoil 500ppm's price at $69.09 a barrel.
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New Law Removes Ethanol Mandate For Isle Gasoline
Gov. David Ige without fanfare signed a bill last week officially repealing the state mandate requiring the blending of gasoline with ethanol for transportation fuel, although federal regulations may require that ethanol continue to be part of the energy mix here.
The state Legislature imposed the ethanol mandate in 2006 as part of an ambitious plan to launch a major new local biofuels industry. Since then, almost all gasoline sold in Hawaii has had to be composed of 10 percent ethanol — an alcohol-based fuel that can be made from sugar or corn. “While the Hawaii mandate will end on Dec. 31, 2015, producers are still required to blend renewable fuel into gasoline and diesel under the federal Renewable Fuel Standard program.”
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Gov. David Ige without fanfare signed a bill last week officially repealing the state mandate requiring the blending of gasoline with ethanol for transportation fuel, although federal regulations may require that ethanol continue to be part of the energy mix here.
The state Legislature imposed the ethanol mandate in 2006 as part of an ambitious plan to launch a major new local biofuels industry. Since then, almost all gasoline sold in Hawaii has had to be composed of 10 percent ethanol — an alcohol-based fuel that can be made from sugar or corn. “While the Hawaii mandate will end on Dec. 31, 2015, producers are still required to blend renewable fuel into gasoline and diesel under the federal Renewable Fuel Standard program.”
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Pump prices probably have reached their highest point of 2015 and should fall for the rest of the year as refineries run hard to process a glut of oil, providing U.S. drivers the cheapest summer gasoline in six years.
Refineries roaring back to life after shutting down in the spring for seasonal maintenance have been cranking out vast new supplies of fuel for the summer driving season.
In addition, crude prices, which make up about half the cost of a gallon of gasoline, show no signs of rebounding any time soon, especially now that OPEC agreed to maintain its production quotas. That means the oil cartel will continue adding crude onto an oversupplied market, according to AAA and GasBuddy.
“While some states did indeed see increases over the last week, I remain optimistic after OPEC’s meeting last week to keep oil production unchanged that we’ll soon see relief spreading across more of the country,” Patrick DeHaan, GasBuddy senior petroleum analyst, said in a statement.
Adding to the downward pressure on pump prices is lackluster gasoline demand, which has slipped 2 percent since Memorial Day, GasBuddy said.
“It has been a bumpy ride the last few weeks as our analyst team has continued to monitor and forecast when the peak would arrive, but based on current factors and signs, we could see price declines begin to accelerate,” the gas price analyst firm said in a statement.
That’s welcome news for motorists who saw gasoline prices surge in the spring, pushed up by rallying crude prices, refinery shutdowns and the switchover to more expensive summer-blend fuel. On Monday, the national average stood at $2.76 per gallon, a penny shy from the 2015 peak reached on Thursday and Friday. Despite the recent rise, gasoline remains at its cheapest level since 2009, a trend that’s expected to continue throughout the summer.
“If gasoline prices hold this summer near the mid/upper $2 range, it would save motorists nearly $32 billion between June and August alone,” GasBuddy said.
Fuel is even cheaper in Houston, where stations on average are selling gasoline for $2.50 per gallon, according to GasBuddy.com’s survey of near 2,600 fuel outlets. That’s 91 cents cheaper than the same time last year.
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Refineries roaring back to life after shutting down in the spring for seasonal maintenance have been cranking out vast new supplies of fuel for the summer driving season.
In addition, crude prices, which make up about half the cost of a gallon of gasoline, show no signs of rebounding any time soon, especially now that OPEC agreed to maintain its production quotas. That means the oil cartel will continue adding crude onto an oversupplied market, according to AAA and GasBuddy.
“While some states did indeed see increases over the last week, I remain optimistic after OPEC’s meeting last week to keep oil production unchanged that we’ll soon see relief spreading across more of the country,” Patrick DeHaan, GasBuddy senior petroleum analyst, said in a statement.
Adding to the downward pressure on pump prices is lackluster gasoline demand, which has slipped 2 percent since Memorial Day, GasBuddy said.
“It has been a bumpy ride the last few weeks as our analyst team has continued to monitor and forecast when the peak would arrive, but based on current factors and signs, we could see price declines begin to accelerate,” the gas price analyst firm said in a statement.
That’s welcome news for motorists who saw gasoline prices surge in the spring, pushed up by rallying crude prices, refinery shutdowns and the switchover to more expensive summer-blend fuel. On Monday, the national average stood at $2.76 per gallon, a penny shy from the 2015 peak reached on Thursday and Friday. Despite the recent rise, gasoline remains at its cheapest level since 2009, a trend that’s expected to continue throughout the summer.
“If gasoline prices hold this summer near the mid/upper $2 range, it would save motorists nearly $32 billion between June and August alone,” GasBuddy said.
Fuel is even cheaper in Houston, where stations on average are selling gasoline for $2.50 per gallon, according to GasBuddy.com’s survey of near 2,600 fuel outlets. That’s 91 cents cheaper than the same time last year.
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Cheapest gasoline in 5 years spurs uptick in summer travel
With pump prices at their cheapest levels in years, more Americans are expected to celebrate the long Fourth of July weekend with a road trip.
Cheap gasoline prices are causing more drivers to take to the highways, with an estimated 41.9 million people expected to travel more than 50 miles this Independence Day, the highest total since 2007, according to AAA.
“It is much easier for a driver to take a summer road trip knowing that they have saved hundreds of dollars on gas so far this year,” AAA spokesman Avery Ash said in a statement.
Falling oil prices have pulled U.S. gasoline prices to their lowest levels in five years, providing Americans about $65 billion in fuel savings this year, or an average of $530 for every U.S. household, according to AAA.
The national average for gasoline was $2.77 per gallon Tuesday, or 91 cents cheaper than the same time last year and the lowest price drivers have seen since 2010, AAA said. The average retail price in Houston was $2.55, down 94 cents from last year, according to AAA’s Daily Fuel Gauge Report.
With oil prices showing no signs of rebounding from the $60 per barrel range where they’ve settled since mid-April, and refineries rushing to crank out as much gasoline as possible, fuel prices may continue plummeting for the rest of the year.
Barring any refinery disruptions, unrest in the Middle East, strong Atlantic hurricanes or a sudden and dramatic swell in demand, gasoline prices may have reached their 2015 peak at $2.80 per gallon on June 15 the group said.
“There is real possibility that gas prices will drop this month as millions of Americans hit the road for their summer vacation,” Ash said.
Cheap fuel paired with a stronger U.S. economy has spurred a 3 percent uptick gasoline demand in the first half of this year, according to the U.S. Energy Information Administration. Summertime demand appears even stronger, with drivers burning about 4.5 percent more gasoline in the past four weeks than they did during the same time last year, AAA said.
Gasoline demand in the coming weeks will be key in determining whether prices rise or fall for the rest of the summer, AAA said. July and August are typically the busiest driving months, with demand trailing off after Labor Day, followed by a quick fall in fuel prices.
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With pump prices at their cheapest levels in years, more Americans are expected to celebrate the long Fourth of July weekend with a road trip.
Cheap gasoline prices are causing more drivers to take to the highways, with an estimated 41.9 million people expected to travel more than 50 miles this Independence Day, the highest total since 2007, according to AAA.
“It is much easier for a driver to take a summer road trip knowing that they have saved hundreds of dollars on gas so far this year,” AAA spokesman Avery Ash said in a statement.
Falling oil prices have pulled U.S. gasoline prices to their lowest levels in five years, providing Americans about $65 billion in fuel savings this year, or an average of $530 for every U.S. household, according to AAA.
The national average for gasoline was $2.77 per gallon Tuesday, or 91 cents cheaper than the same time last year and the lowest price drivers have seen since 2010, AAA said. The average retail price in Houston was $2.55, down 94 cents from last year, according to AAA’s Daily Fuel Gauge Report.
With oil prices showing no signs of rebounding from the $60 per barrel range where they’ve settled since mid-April, and refineries rushing to crank out as much gasoline as possible, fuel prices may continue plummeting for the rest of the year.
Barring any refinery disruptions, unrest in the Middle East, strong Atlantic hurricanes or a sudden and dramatic swell in demand, gasoline prices may have reached their 2015 peak at $2.80 per gallon on June 15 the group said.
“There is real possibility that gas prices will drop this month as millions of Americans hit the road for their summer vacation,” Ash said.
Cheap fuel paired with a stronger U.S. economy has spurred a 3 percent uptick gasoline demand in the first half of this year, according to the U.S. Energy Information Administration. Summertime demand appears even stronger, with drivers burning about 4.5 percent more gasoline in the past four weeks than they did during the same time last year, AAA said.
Gasoline demand in the coming weeks will be key in determining whether prices rise or fall for the rest of the summer, AAA said. July and August are typically the busiest driving months, with demand trailing off after Labor Day, followed by a quick fall in fuel prices.
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