AAA: Low demand leads to lower gasoline prices

Feb. 17 (UPI) — Sluggish demand and lingering concerns about a slowdown in economic growth have kept retail gasoline prices in the US economy from moving much, data show.

The AAA Travel Club said the nationwide average retail price on Friday was $3.42 a gallon of regular unleaded gasoline, relatively unchanged from last week.

“Slow gas demand and fluctuating oil prices are the main reasons why the national average remains neutral.” declared AAA.

Crude oil prices fell sharply on Friday amid fears that the US Federal Reserve’s policies will create further headwinds for the economy. Inflation at the consumer level increased from the previous month in January, and wholesale prices are rising, raising fears that the Fed will not stop raising lending rates to slow things down.

However, demand has fallen sharply in recent years. US Department of Energy data showed that total petroleum product shipments to the market in the four-week period ended Feb. 10 averaged 19.8 million barrels per day, more than 10% lower than last year and less than the same figure. week in 2020 to account for the COVID-19 pandemic.

Total gasoline inventories increased in the period ended Feb. 10, indicating a lull in consumer demand.

The downward trend is most pronounced in states near a dense network of oil refineries along the Gulf Coast. AAA data shows that Texas has the lowest price in the country at $3.03 per gallon.

However, this could be a low point, given forecasts for a busy period of regular seasonal maintenance at national refineries and a switch to summer blend gasoline, which is more expensive to produce due to the extra processing needed to prevent it. evaporates in warm weather.

The national average price can certainly jump to $4 a gallon during the summer, with federal forecasts for a yearly average of $3.39 a gallon compared to an average of $3.97 in 2022.

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