VIRGINIA BEACH, Va., (May 26, 2015) - The national average for regular unleaded gasoline reached its highest price of the year on Memorial Day ($2.74) after rising for 39 of 41 days. Today’s average price per gallon is only a fraction of a penny less than yesterday. Drivers are paying three cents more than one week ago, eight cents more than two-weeks ago and 21 cents more than one month ago to refuel their vehicles.
Even with the continued increase in prices over the last two months, gas is still significantly lower than last year in Hampton Roads. Currently at $2.54, this is three cents more than a week ago, 24 cents more than a month ago, but still $1.00 less than last year across the region. Despite the overall trend of rising averages, consumers still paid the lowest prices at the pump for the holiday since 2010. Significant yearly discounts remain, due to relatively low prices for crude oil, with today’s national average representing a savings of 92 cents per gallon compared to this same date last year.
Pump prices have recently trended higher due to an increase in the price of global crude and localized refinery issues, particularly in the Midwest and on the West Coast. Although West Coast states continue to post the nation’s highest state averages, the most dramatic weekly increases have been in the Midwest, largely attributed to production issues in that market. ExxonMobil’s Joliet, Ill. refinery is continuing to operate at reduced production levels, and CITGO’s refinery in Lemont, Ill. is reportedly scheduled to conduct maintenance work in the coming days, which could also add additional volatility to the regional market.
Volatility is expected to continue to characterize global oil prices, with a number of variables potentially impacting the sensitive balance between supply and demand. Geopolitical tensions in the Middle East are persisting, largely due to violence by the so-called Islamic State in Iraq and Syria, which adds a level of risk to regional oil production. At the same time, the strength of the U.S. dollar is improving on the heels of improved inflation data. A stronger dollar makes crude oil relatively more expensive for those overseas, which puts downward pressure on prices. Both factors are likely to influence the global price in the near term and market watchers are closely monitoring the ultimate impact on the global price of crude. At the close of Friday’s formal trading on the NYMEX, West Texas Intermediate crude oil settled $1 lower at $59.72 per barrel.
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