Historic slide for U.S. gasoline nearing its end

Seasonal issues mean gas prices should climb by mid-February or so.

By Daniel J. Graeber

WASHINGTON, Jan. 20 (UPI) -- Though gasoline prices continue to fall nation-wide, a fuels analyst said Tuesday the trend may reverse as U.S. refineries start entering a maintenance phase.

Motor club AAA reports a national average price for a gallon of regular unleaded gasoline at $2.05, a slight decline from Monday but $1.23 less than this date in 2014. Half of all states are reporting averages below the $2 mark, with Missouri posting the lowest price at $1.76 per gallon.


The low price at the pump is a reflection of crude oil prices, which are off more than 50 percent from their June values. While the low price of oil is leaving producers and those in secondary energy industries struggling, low gasoline prices are seen as a de facto stimulus for U.S. consumers.

Tom Kloza, global head of energy analysis at the Oil Price Information Service, told UPI in response to e-mail questions the trend may reserve by February.

Goundhog Day, Feb. 2, is usually the point at which gasoline prices begin a seasonally swing upward.

"This year is special since there is so much bearish sentiment about crude, but refiners are now commencing maintenance and that generally lifts gasoline versus crude toward the end of the first quarter," he said in a statement.


Retail gasoline prices are typically lower during winter months because refiners produce a type of fuel that's cheaper to produce. A maintenance period typically precedes the April switch to summer-grade gasoline, which must be refined in such a way as to ensure fuel doesn't vaporize in vehicle fuel systems.

As the period running up to the switch gets under way, Kloza said refiners, particularly in the Midwest, need to get rid of high-vapor pressure fuels to make room for summer gasoline.

"Midwest may still have a bit of a bloodletting," he said. "That purge can temporarily bring some very low numbers and it usually occurs between Jan 20-Feb. 15 or so."

Michael Green, a spokesman for AAA, confirmed the general sentiment, saying retail prices may be close to the bottom. It's been 117 days since the national average price increase, but that streak can't continue forever.

"Gas prices in recent days have fallen at the slowest pace since November," he told said in e-mailed statements. "It probably is just a matter of time until we see the first daily increase in gas prices since September."

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