VIRGINIA BEACH, Va., (October 26, 2015) – Many areas in the seven cities are experiencing lower gas prices due to falling crude oil prices supported by a buildup in domestic inventory. Hampton Roads current gas price per gallon is $1.96 which is six cents less than last month and 91 cents lower than last year. For 14 consecutive days the average price for a gallon of regular gas has dropped. This is good news for motorists as the holidays are fast approaching.
This year’s autumn refinery maintenance season has been heavier than usual due to a busy summer driving season, which caused refineries to operate at higher rates for longer periods of time. Although the planned maintenance season is well underway, regional pump prices could remain volatile due to fluctuations in supply and demand. However, ample domestic supply is expected to keep the broader national average relatively steady as the refinery maintenance season concludes. Market fundamentals continue to suggest that the national average could fall below the $2 per gallon benchmark before the end of the year for the first time since 2009, barring any unanticipated disruptions in supply or unforeseen jumps in the price of crude oil.
A total of eight states are posting averages below the $2 per gallon threshold, with consumers in Virginia ($1.99) in eighth place following behind states such as South Carolina ($1.89), Alabama ($1.92) and Mississippi ($1.92) paying the lowest averages in the country.
A bearish sentiment continues to prevail in the global oil market and reports are beginning to surface that current low prices for crude oil are impacting outlooks for oil companies, evidenced by announcements in cutbacks and delays in new project investments. Technical experts from both OPEC and non-OPEC countries convened last week, and many hoped action to address the market’s oversupply was on the horizon, but cuts to production were not discussed.
Market watchers to start the week are reportedly focused on a key decision on interest rates by the U.S. Federal Reserve and economic data from the U.S. The Fed has kept interest rates relatively unchanged since 2008 in effort to stimulate economic growth. An increase in the Fed interest rate typically leads to a strengthening U.S. dollar, which makes oil relatively more expensive for those holding foreign currencies. This move could further exacerbate the market’s current state and keep a ceiling on global oil prices in the near term.
Oil rig production in the U.S. fell for the eighth consecutive week, however the latest data from the U.S. Department of Energy points to an increase in domestic crude oil stocks. West Texas Intermediate crude oil fell below the $45 per barrel benchmark last week for the first time since early October, and closed out Friday’s formal trading session on the NYMEX down 78 cents with a settlement at $44.60 per barrel.
Motorists can find current gas prices along their route with the free AAA Mobile app for iPhone, iPad and Android. The app can also be used to map a route, find discounts, book a hotel and access AAA roadside assistance. Learn more at AAA.com/mobile.
As part of North America’s largest motoring and leisure travel organization, AAA Tidewater Virginia provides its more than 325,000 members with travel, insurance, financial and automotive-related services. Since its founding AAA Tidewater Virginia has been a leader and advocate for the safety and security of all travelers. For more information, visit AAA.com and follow us on Twitter at Twitter.com/AAATidewaterVA or on Facebook at facebook.com/AAATidewaterVirginia