The U.S. Energy Information Administration (EIA) released its weekly data on diesel and gasoline retail prices for the week ended October 28, 2019. Gasoline prices fell, while diesel prices rose. On a national average basis, retail prices for gasoline dropped by 4.2 cents/gallon for the week. National average prices for gasoline were 21.5 cents/gallon below where they were in the same week one year ago. On a national average basis, retail prices for diesel rose by 1.4 cents/gallon. National average prices for diesel were 29.1 cents/gallon lower than they were in the same week last year.
Futures Prices and Retail Price Outlook
During the week October 21-October 25, 2019, West Texas Intermediate (WTI) crude futures prices rose by $2.36/barrel (4.4%.) Gasoline futures prices rose by 4.36 cents/gallon (2.7%.) Diesel futures prices rose by 4.0 cents/gallon (2.058%.) Although the relationship between futures prices and retail prices is not immediate or one-for-one, retail prices are likely to rise in the coming week.
Retail Diesel Prices
For the current week ended October 28, retail diesel prices increased by 1.4 cents to arrive at an average price of $3.064/gallon. Retail diesel prices had been below the $3/gallon mark until the attacks on Saudi Arabia. Prices had eased over the past three weeks before creeping up slightly this week. Between mid-October and late-January, retail diesel prices fell for fourteen consecutive weeks. During those fourteen weeks, the price decline totaled 42.9 cents/gallon. From February through April, diesel prices crept back up by 20.4 cents/gallon. The month of May brought a modest reversal in the upward trend in diesel prices. During the five weeks of June including the week ended July 1, diesel prices fell more substantially, declining by 10.9 cents/gallon. For the current week ended October 28, diesel prices rose in all PADDs countrywide. The national average price for the week was 29.1 cents/gallon below where it was during the same week last year.
In the East Coast PADD 1, diesel prices rose by 1.1 cents to arrive at an average price of $3.056/gallon. Within PADD 1, New England prices dropped by 1.7 cents to average $3.028/gallon. Central Atlantic diesel prices increased by 1.1 cents to average $3.246/gallon. Lower Atlantic prices rose by 1.6 cents to reach an average price of $2.932/gallon. PADD 1 prices were 29.0 cents/gallon below their prices for the same week last year.
In the Midwest PADD 2 market, retail diesel prices rose by 0.6 cents to average $2.963/gallon. Prices were 34.7 cents/gallon below their level for the same week last year. PADD 2 joined PADD 3 during the week ended June 17 in having diesel prices fall below $3/gallon. These two PADDs are the only ones with prices remaining below the $3/gallon mark.
In the Gulf Coast PADD 3, retail diesel prices increased by 0.4 cents to average $2.806/gallon. PADD 3 typically has the lowest diesel prices among the PADDs. Prices were 31.1 cents lower than for the same week in the previous year.
In the Rocky Mountains PADD 4 market, retail diesel prices rose by 3.8 cents to average $3.082/gallon. PADD 4 prices were 32.3 cents lower than for the same week in the prior year.
In the West Coast PADD 5 market, retail diesel prices rose by 4.9 cents to reach an average of $3.675/gallon. This was the largest price increase among the PADDs. PADD 5 prices were 12.4 cents below their level from last year. Prices excluding California jumped by 8.9 cents to arrive at an average of $3.379/gallon. This price was 18.5 cents below the retail price for the same week last year. California diesel prices rose by 1.8 cents to arrive at an average price of $3.998/gallon. Until the week ended June 24, California had been the only major market where diesel prices were above $4/gallon, where they had remained for nine weeks. Prices now are very close to the $4/gallon mark. California diesel prices were 7.6 cents lower than they were at the same week last year.
Retail Gasoline Prices
U.S. retail gasoline prices fell by 4.2 cents to settle at an average of $2.596/gallon during the week ended October 28th. Prices fell in all PADDs except for PADD 4, the Rocky Mountains. Retail prices for the current week were 21.5 cents per gallon lower than they were one year ago. Gasoline prices hit a peak of $2.903/gallon during the week ended October 8, 2018. Prices then slid downward for fourteen weeks in a row, shedding a total of 66.6 cents per gallon. In the next seventeen weeks, prices marched back up by 66.0 cents/gallon. Prices came very close to the peak they hit in early October. However, the months of May and the June brought an easing of prices amounting to 23.3 cents per gallon. The week ended July 1st reversed that downward trend and sent prices up once again.
During the first three weeks of July, gasoline prices rose by 12.5 cents/gallon. This outpaced the increases in crude oil and diesel prices mainly because of the explosion and fire at the 335,000-bpd, gasoline-maximizing Philadelphia Energy Systems (PES) refinery. Tropical Storm Barry then caused an uptick in prices. Subsequently, prices began to relax, and they fell for eight consecutive weeks beginning with the week of July 22, yielding a total price drop of 20.0 cents/gallon.
For the current week ended October 28, East Coast PADD 1 retail prices for gasoline fell by 2.8 cents to average $2.454/gallon. The average price was 27.9 cents/gallon below where it was during the same week last year. Within PADD 1, New England prices eased by 0.4 cents to average $2.526/gallon. Central Atlantic market prices declined by 0.5 cents to average $2.601/gallon. Prices in the Lower Atlantic market dropped by 4.9 cents to average $2.343/gallon.
In the Midwest PADD 2 market, retail gasoline prices dropped by 6.6 cents to average $2.410/gallon. This was the largest price drop among the PADDs. PADD 2 prices for the current week were 27.0 cents/gallon lower than they were for the same week last year.
In the Gulf Coast PADD 3 market, gasoline prices fell by 3.4 cents to average $2.245/gallon. PADD 3 continues to have the lowest average prices among the PADDs, currently 35.1 cents/gallon below the average U.S. price. Prices for the week were 27.8 cents lower than for the same week last year.
In the Rocky Mountains PADD 4 market, gasoline pump prices rose by 0.9 cents to reach an average price of $2.737/gallon. This was the only price increase among the PADDs. This week’s prices were 22.1 cents lower than at the same time last year.
In the West Coast PADD 5 market, retail gasoline prices fell by 4.7 cents to average $3.602/gallon. This is the second weekly price decline after four weeks of rising prices, which added up to a major price hike of 41.1 cents per gallon. Problems were reported at several key refineries in California. Refinery issues were magnified by two earthquakes.
PADD 5 continues to have the highest gasoline prices among the five PADDs. It is the only PADD where retail prices exceed $3/gallon. It also is the only PADD where prices are higher than they were last year: This week’s prices were 12.0 cents above where they were during the same week in 2018. Excluding California, West Coast prices eased by 0.6 cents to average $3.183/gallon. This price was 4.8 cents lower than at the same time last year. In California, pump prices dropped by 8.2 cents to average $3.948/gallon—finally bringing prices back below the $4/gallon level. California prices were 26.5 cents per gallon above their levels from the same week last year. It is the only major U.S. submarket where prices are higher than they were one year ago.
In the coming week, patterns of fuel demand and price will be affected by wildfires and “public safety power shutoffs,” or PSPS. Over three million people in California have had their power shut off to reduce the risk of wildfires during a severe windstorm event. Fires have broken out nonetheless, and over 200,000 people have been evacuated.