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 19th, 2018. At the national level, gasoline prices rose by 3.9 cents/gallon. Prices rose in all PADDs. Diesel prices continued to decline modestly, falling by 0.4 cents per gallon. Diesel prices fell in PADDs 1, 2 and 5, and rose in PADDs 2 and 3.
Crude prices strengthened during the week ended March 16, with futures prices for WTI crude rising by $0.24/b. US crude production continued to expand, averaging 10.381 mmbpd during the week ended March 9. US crude oil stockpiles grew by over 5 million barrels during the week ended March 9, but the price effect was moderated by large drawdowns in gasoline and diesel inventories, of 6.27 million barrels and 4.36 million barrels respectively. On the global crude side, the participants in the OPEC production cuts, including Russia, have been keeping compliance rates very high—well above 100%. As of the time of this writing, WTI crude prices are approaching the $63/b level.
US gasoline demand appeared to strengthen during the week ended March 9, up by 366 kbpd, following an apparent increase of 416 kbpd in the prior week. Diesel product supplied fell by 94 kbpd during the week.
For the current week ended March 19, diesel prices declined by 0.4 cents to arrive at an average price of $2.972 gallon. Until the 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 1.5 cents during the week to average $3.009/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 11.4 cents between the week ended February 5 and the current week ended March 19th. Within the PADD, New England prices decreased by 0.6 cents to average $3.101/gallon. Central Atlantic diesel prices dropped by 2.1 cents to average $3.20/gallon. This submarket has had diesel prices above $3/gallon for the past nineteen weeks. Lower Atlantic prices decreased by 1.3 cents to arrive at an average price of $2.858/gallon. PADD 1 prices were 40.9 cents/gallon above their prices for the same week last year.
In the Midwest PADD 2 market, retail diesel prices edged down by 0.1 cents to average $2.898/gallon. Prices were 43.4 cents/gallon above their level for the same week last year.
In the Gulf Coast PADD 3, retail diesel prices increased by 0.4cents to average $2.786/gallon. This price was 40.6 cents higher than for the same week in the previous year.
In the Rocky Mountains PADD 4 market, retail diesel prices rose by 2.2 cents to average $2.925/gallon. PADD 4 prices were 33.5 cents higher than in the prior year.
In the West Coast PADD 5 market, retail diesel prices decreased by 0.2 cents to average $3.384/gallon. This price was 55.8 cents above its level from last year. Prices excluding California rose by 0.8 cents to average $3.060/gallon, which was 35.8 cents above the retail price for the same week last year. California diesel prices fell by 1.1 cents to arrive at an average price of $3.641/gallon. This price was 71.3 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 $2.972/gallon, down from $2.976/gallon the prior week.
U.S. retail gasoline prices rose by 3.9 cents during the week ended March 19, to arrive at an average price of $2.598/gallon. Prices rose in all PADDs.
For the current week ended March 19th, East Coast PADD 1 retail prices for gasoline increased by 2.7 cents to $2.536/gallon. The average price was 27.0 cents higher than last year’s price. Within PADD 1, prices increased by 0.2 cents in New England to an average of $2.556/gallon. Central Atlantic market prices fell by 0.2 cents to $2.628/gallon. Prices in the Lower Atlantic market jumped by 5.8 cents, to an average price of $2.462/gallon. This was 27.9 cents higher than last year’s average price for the same week.
In the Midwest PADD 2 market, retail gasoline prices rose by 5.8 cents, reaching an average price of $2.495/gallon. Gasoline pump prices were 27.4 cents higher than they were one year ago.
In the Gulf Coast PADD 3 market, gasoline prices increased by 0.3 cents to average $2.304/gallon. PADD 3 continues to have the lowest average prices among the PADDs. Prices for the week were 23.2 cents higher than for the same week in 2017.
In the Rocky Mountains PADD 4 market, gasoline pump prices rose by 2.0 cents to average $2.443/gallon. PADD 4 prices were 13.9 cents higher than at the same time in 2017.
In the West Coast PADD 5 market, retail gasoline prices increased by 4.5 cents to arrive at an average price of $3.215/gallon. This was 36.6 cents higher than at the same time a year ago. PADD 5 typically has the highest gasoline prices among the five PADDs. During the eleven weeks of 2018 to date, PADD 5 has been the only PADD where prices have exceeded $3/gallon. Excluding California, West Coast prices jumped by 5.5 cents, to an average of $2.842/gallon. This was 25.6 cents higher than at the same time in 2017. In California, prices rose by 3.9 cents to arrive at an average pump price of $3.431/gallon. California prices were 43.0 cents per gallon above their levels from last year.