Analysis by Dr. Nancy Yamaguchi
The Energy Information Administration (EIA) released its weekly data on diesel and gasoline retail prices for the week ended March 12, 2018. At the national level, gasoline prices remained nearly flat, edging down by a mere 0.1 cents/gallon. Price movements varied significantly at the PADD level. Diesel prices continued to decline, falling by 1.6 cents per gallon. Gasoline prices were variable, rising in PADDs 2 and 5 while falling in PADDs 1, 3 and 4. Diesel prices fell in all PADDs countrywide.
Crude prices continued to weaken during the week ended March 9, with futures prices falling by $0.89/b. US crude production continued to expand, averaging 10.369 mmbpd during the week ended March 2. Growth in US exports, including exports to Asia-Pacific markets, have reduced the effectiveness of the OPEC production cuts. As of the time of this writing, WTI crude prices are in the range of $61.25-$61.50/b.
US gasoline demand appeared to strengthen during the week ended March 2, up by over 400 kbpd after apparent declines during the three prior weeks. Diesel product supplied was relatively stable, rising slightly by 5 kbpd during the week.
For the current week ended March 12, diesel prices fell by 1.6 cents to arrive at an average price of $2.976 gallon. Until the prior week ended March 5, US national average retail diesel prices had exceeded $3/gallon for seven consecutive weeks.
In the East Coast PADD 1, diesel prices dropped 2.2 cents during the week to average $3.024/gallon. In early January, PADD 1 joined PADD 5 in having diesel prices above $3/gallon. In February, however, diesel prices began to subside, dropping by 10.9 cents between the week ended February 5 and the current week ended March 12. Within the PADD, New England prices edged decreased by 1.9 cents to average $3.107/gallon. Central Atlantic diesel prices also decreased by 1.9 cents to average $3.221/gallon. This submarket has had diesel prices above $3/gallon for the past eighteen weeks. Lower Atlantic prices dropped by 2.3 cents to arrive at an average price of $2.871/gallon. PADD 1 prices were 40.7 cents/gallon above their prices for the same week last year.
In the Midwest PADD 2 market, retail diesel prices fell by 2.1 cents to average $2.899/gallon. Prices were 40.8 cents/gallon above their level for the same week last year.
In the Gulf Coast PADD 3, retail diesel prices decreased by 1.1 cents to average $2.782/gallon. This price was 36.3 cents higher than for the same week in the previous year.
In the Rocky Mountains PADD 4 market, retail diesel prices declined by 0.7 cents to average $2.903/gallon. PADD 4 prices were 28.6 cents higher than in the prior year.
In the West Coast PADD 5 market, retail diesel prices decreased by 0.6 cents to average $3.386/gallon. This price was 54.0 cents above its level from last year. Prices excluding California fell by 1.2 cents to average $3.052/gallon, which was 31.6 cents above the retail price for the same week last year. California diesel prices were unchanged at an average price of $3.652/gallon. This price was 71.6 cents higher than last year’s price. Until January, PADD 5 had been the only PADD to have diesel prices above $3 per gallon. Prices around the country climbed until the national retail average exceeded the $3/gallon mark as of the week ended January 15. Prices subsided as crude oil prices fell, and this week’s average retail price is $2.976/gallon, down from $2.992/gallon the prior week.
U.S. retail gasoline prices eased slightly by 0.1 cents during the week ended March 12, to arrive at an average price of $2.559/gallon. There was significant variation in price movement among the PADDs.
For the current week ended March 12th, East Coast PADD 1 retail prices for gasoline dropped by 2.5 cents to $2.509/gallon. The average price was 23.6 cents higher than last year’s price. Within PADD 1, prices declined by 1.1 cents in New England to an average of $2.554/gallon. Central Atlantic market prices fell by 1.7 cents to $2.630/gallon. Prices in the Lower Atlantic market dropped by 3.6 cents, to an average price of $2.404/gallon. This was 21.3 cents higher than last year’s average price for the same week.
In the Midwest PADD 2 market, retail gasoline prices rose by 1.1 cents, reaching an average price of $2.439/gallon. Gasoline pump prices were 22.2 cents higher than they were one year ago.
In the Gulf Coast PADD 3 market, gasoline prices decreased by 0.4 cents to average $2.274/gallon. PADD 3 continues to have the lowest average prices among the PADDs. Prices for the week were 19.9 cents higher than for the same week in 2017.
In the Rocky Mountains PADD 4 market, gasoline pump prices decreased by 1.4 cents to average $2.423/gallon. PADD 4 prices were 11.8 cents higher than at the same time in 2017.
In the West Coast PADD 5 market, retail gasoline prices increased by 2.9 cents to arrive at an average price of $3.170/gallon. This was 31.9 cents higher than at the same time a year ago. PADD 5 typically has the highest gasoline prices among the five PADDs. During the ten weeks of 2018 to date, PADD 5 has been the only PADD where prices have exceeded $3/gallon. Excluding California, West Coast prices increased by 1.7 cents, to an average of $2.787/gallon. This was 20.3 cents higher than at the same time in 2017. In California, prices jumped by 3.6 cents to arrive at an average pump price of $3.392/gallon. California prices were 38.7 cents per gallon above their levels from last year.