AAA takes long view on gas prices

WASHINGTON, Nov. 24 (UPI) -- While short-term spikes may be expected in some retail markets, U.S. drivers this upcoming holiday are paying record low prices for gasoline, AAA said.

The motor club reports a national average retail price for a gallon of regular unleaded gasoline for Tuesday at $2.06 per gallon, about 0.5 percent lower than the previous day and nearly 4 percent lower than this time last week.

This summer, gasoline prices in some Midwest markets spiked above the $3 per gallon mark following a series of refinery issues, notably an outage at BP's refinery in Whiting, Ind. With a season of heavy refinery maintenance over, gasoline prices are moving largely on supply and demand issues.

Even though holiday roads are expected to be busy, AAA said demand over the long view is usually lower in the waning weeks of the year.

"Demand for gasoline typically declines during the month of November, and barring any unexpected disruptions in supply, the national average [retail price for gasoline] is expected to move lower leading into 2016," it said in a weekly retail market report.

Brent crude oil prices in early Tuesday trading moved up close to a full percentage point to more than $45 per barrel, largely on geopolitical issues surrounding terrorist concerns and conflict along the border with Turkey and Syria. Crude oil prices spiked in late September after Russia lent military support to ally and Syrian President Bashar Assad, only to move lower as economic fundamentals settled back into the markets.

The average price for regular unleaded gasoline in New York City moved up a fraction of a penny to $2.43 per gallon. The price for gas in the nation's capital moved 1.1 percent lower overnight to $2.29 per gallon.

AAA said a ramp up on crude oil supplies from key producers like Russia and Saudi Arabia, coupled with slower economic growth in the Chinese economy, will continue to put downward pressure on crude oil prices long term. Crude oil prices account for about half of the price at the pump.