Analysis by Dr. Nancy Yamaguchi
The Energy Information Administration (EIA) released its weekly data on diesel and gasoline retail prices for the week ended December 18, 2017. At the national level, gasoline prices fell by 3.5 cents per gallon, while diesel prices declined by 0.9 cents per gallon. Gasoline and diesel retail prices fell in all PADDs.
WTI crude prices have been flat over the past week, following two weeks of decline. There was a bump-up in Brent crude prices when news came out revealing a crack in the Forties Pipeline, but the price surge was not large and sustained. The potential disruption from an oil strike in Nigeria also eased.
US crude production rose again during the week ended December 1, hitting a new record-high 9.7 mmbpd. The highest annual average production ever achieved in the US was 9.637 mmbpd in 1970, according to the EIA.
During the week ended December 1st, apparent demand for gasoline rose by 171 kbpd, while diesel demand dropped by145 kbpd. The EIA reported that both gasoline and diesel stockpiles grew during the week ended December 1, with a massive 6.78 mmbbls flowing into gasoline inventories and 1.667 mmbbls added to distillate inventories. Crude stocks were drawn down by 5.61 mmbbls.
For the current week ended December 18th, diesel prices decreased by 0.9 cents to arrive at an average price of $2.901/gallon.
PADD 1 retail diesel prices fell by 0.4 cents to $2.897/gallon. Within the PADD, New England prices rose by 2.4 cents to average $2.924/gallon. Central Atlantic diesel prices remained flat at $3.060/gallon. This submarket has had diesel prices above $3/gallon for the past six weeks. Lower Atlantic prices decreased by 1.0 cents to arrive at an average price of $2.778/gallon. PADD 1 prices were 33.8 cents/gallon above their prices for the same week last year.
In the Midwest PADD 2 market, retail diesel prices fell by 1.0 cents to average $2.853/gallon. Prices were 37.4 cents/gallon above their level for the same week last year.
In the Gulf Coast PADD 3, retail diesel prices declined by 0.8 cents to average $2.697/gallon. This price was 28.7 cents higher than in the previous year.
In the Rocky Mountains PADD 4 market, retail diesel prices dropped by 3.3 cents to average $2.958/gallon. Earlier in December, PADD 4 had been in company with PADD 5 in having diesel prices above $3/gallon. PADD 4 prices were 46.3 cents higher than in the prior year.
In the West Coast PADD 5 market, retail prices fell by 1.7 cents to average $3.327/gallon. This price was 53.9 cents above its level from last year. Prices excluding California dropped by 2.8 cents to average $3.044/gallon, which was 33.9 cents above the retail price for the same week last year. California diesel prices decreased by 0.8 cents to an average price of $3.552/gallon. This price was 69.8 cents higher than last year’s price. PADD 5 is once again the only PADD to have diesel prices above $3 per gallon.
U.S. retail gasoline prices decreased by 3.5 cents for the week ended December 18, to arrive at an average price of $2.45/gallon.
For the current week ended December 18th, East Coast PADD 1 retail prices for gasoline fell by 2.7 cents to $2.438/gallon. The average price was 14.8 cents higher than last year’s price. Prices dropped by 2.1 cents in New England to $2.525/gallon. Central Atlantic market prices declined by 1.8 cents to $2.571/gallon. Prices in the Lower Atlantic market dropped by 3.5 cents, to an average price of $2.313/gallon. This was 8.7 cents higher than last year’s average price for the same week. Among submarkets, Lower Atlantic prices have risen the least relative to last year’s levels.
In the Midwest PADD 2 market, retail gasoline prices dropped by 4.7 cents to arrive at an average price of $2.324/gallon. Last week, PADD 2 had been the only PADD where retail prices rose. Gasoline pump prices were 13.2 cents higher than they were one year ago.
In the Gulf Coast PADD 3 market, gasoline prices dropped by 5.2 cents to average $2.164/gallon. This was the largest price drop among the five PADDs, and PADD 3 continues to have the lowest average prices. Prices for the week were 11.1 cents higher than for the same week in 2016.
In the Rocky Mountains PADD 4 market, gasoline pump prices decreased by 3.8 cents to average $2.476/gallon. PADD 4 prices were 34.1 cents higher than at the same time in 2016.
In the West Coast PADD 5 market, retail gasoline prices declined by 1.3 cents to average $2.961/gallon. This was 39.8 cents higher than at the same time a year ago. PADD 5 typically has the highest gasoline prices among the five PADDs. Its retail gasoline prices had been back above $3/gallon for four weeks until the prior week ended December 11. All five PADDs now have retail prices averaging below $3/gallon, though at the State level, California prices remain above $3/gallon. Excluding California, West Coast prices decreased by 1.4 cents to an average of $2.71/gallon. This was 33.3 cents higher than at the same time in 2016. In California, prices fell by 1.4 cents, arriving at an average pump price of $3.106/gallon. California prices were 43.6 cents per gallon above their levels from last year.