Drivers to get slightest break

Summer gas price to dip a penny
Associated Press
Apr 8, 2014

Drivers will get the slightest of breaks on gasoline prices this summer, according to the Energy Department.

The national average price is forecast to fall — by just one cent — to $3.57 a gallon between April and September, the months when Americans do most of their driving.

Still, that would be the lowest average summer price since 2010.

For the year, the department's Energy Information Administration expects gasoline to average $3.45 a gallon, down from $3.51 last year and also the lowest since 2010.

World demand for oil is growing, but supplies are growing faster than demand, thanks to higher production in the U.S., Canada and elsewhere. That will keep a lid on the price of crude and gasoline.

The price of Brent crude, a benchmark used to price oil used by many U.S. refineries and the most important factor in gasoline prices, is forecast to fall 4 percent this year.

U.S. drivers are expected to burn slightly more gasoline than they did last year, according to the EIA. More people will drive more miles as the economy continues to improve, but they are driving more fuel efficient cars. That will prevent gasoline demand from rising as fast as the number of miles driven.

EIA Administrator Adam Sieminski warned in a conference call with reporters Tuesday that unexpected factors such as refinery outages, pipeline problems or geopolitical events that disrupt crude flows could send prices quickly higher.

The sudden return of supplies could also send prices lower. The average price of gasoline last summer was five cents lower than what EIA had forecast last spring.

Sieminski said that the amount of oil kept out of the market because of political unrest and logistical factors around the world is far higher now than in the past. Turmoil in Libya, Sudan and elsewhere is keeping about 2.5 million barrels per day of oil off the market, about 3 percent of world demand, up from 500,000 barrels historically, he said.

That has kept the price of Brent crude higher than anticipated in recent months, and it has led to slightly higher gasoline prices than forecast.

The average price of gasoline in the U.S. was $3.59 a gallon Tuesday, the same as last year at this time, according to AAA, OPIS and Wright Express. It has risen steadily since it was $3.27 in early February, as it does almost every late winter and early spring while refiners shut down plants for annual maintenance and switch to more expensive summer blends of gasoline designed to meet clean air rules.

Tom Kloza, chief oil analyst at OPIS and GasBuddy.com, predicts gasoline will continue to rise slightly until it peaks at about $3.65 a gallon in late April, before drifting lower.

That would make for an annual peak lower than last year's $3.79 a gallon and 2012's $3.94 a gallon.

Comments

reader1

How does that explain today's price gouge?

From the Grave

Domestic agitation might be a term for it. Not quite terrorism, since there is no violence involved. But fluctuating fuel prices certainly could justify(in the public opinion)our military presence in the Middle East. What it also might do though, is "fuel" our desire for electric cars. Exxon might want to invest in battery technology and production(if they haven't already).

ladydye_5

Then why did gas jump so high today??? I was in Perrysburg yesterday and it was $3.35....I come to Sandusky today and it is $3.79???? WOW.

YoMamma

Duh is that before or after the $0.30 increase?

xtensionofme

Where's this "disappearing penny"? lol

Darwin's choice

B.O.A.T.......bend over and take it! Vacationland!

been-there-done-that

News media sugar coating as usual. Telling us about the big penny down but not mentioning the 30+ cents up????? They must have their fingers in the oil pot like the government does!Is that penney gonna be a gradual thing??Legalized Price Gouging!!

Restless1

What a dumb article! With prices fluctuating 30 cents week to week, some jerk in the energy dept, looked into his/her's crystal ball and predicted a one cent drop this summer and the AP published it. On the other hand, I predict a 2 cent rise beween May 17 and June 3. Let's see who publishes that.

The Bizness

How about instead of complaining you make changes? Use less fuel, use mass transit, ride a bike or walk, consolidate your trips. Buy a golf cart or other form of vehicle that could be electric if you can't afford an electric car.

I would love to see gas up around 5 bucks a gallon just so people stop relying on fossil fuels so much, and they get out and walk or bike.

Contango

Or, buy shares in energy co. stocks and earn some profit.

$5.00/gal.?

It'll drive up the price of goods and services. Be careful what you wish for.

Yea when gas was regulated, those Nixon and Carter gas lines and shortages were 'fun.'

The Bizness

I know I could handle it, its the other people that I don't think could. You wouldn't see me waiting in lines.

Stop It

It's the Associated Pressed Altogether Report. What did you expect?