Regional markets show variability for U.S. gasoline prices

National average price at the pump is the highest it's been so far this year.
By Daniel J. Graeber  |  May 24, 2016 at 6:08 AM
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WASHINGTON, May 24 (UPI) -- Higher fuel production in the western United States and refinery issues in the Midwest make for two different retail scenarios, market analysis finds.

Motor club AAA reports that retail gasoline prices are the highest they've been so far this year ahead of the long Memorial Day holiday weekend and the national average price at the pump has gone up for 13 consecutive days. The average national retail price for a gallon of regular unleaded gasoline for Tuesday was $2.29, an increase of nearly 3 percent from one week ago and up 7 percent, or 16 cents, from this time last month.

On a national level, much of the increase at the pump may be attributed to higher seasonal demand for fuel products.

"Nearly 34 million people, or 89 percent of all holiday travelers, will drive to their Memorial Day destinations, an increase of 2.1 percent over last year," the motor club said in a weekly retail snapshot.

On a regional level, the story varies. On the West Coast, gasoline production is holding steady while inventory levels indicate a market surplus. The price for gasoline in California, which is typically among the highest in the nation, is up just 1 percent from last month. Four western states and Hawaii lead the nation in year-on-year declines for retail gasoline prices.

Midwest states, meanwhile, lead the nation in terms of increases in retail prices as fires near oil production facilities in Canada put supply-side pressures on the retail market ahead of the long holiday weekend. Michigan gas prices are up 12 percent, or 27 cents, from one month ago. Midwest markets are pressured further because of outages at two BP refineries in the area.

Meanwhile, on the East Coast, a fire at a refinery complex in Philadelphia means that, at $2.45 per gallon, Pennsylvania has some of the highest gasoline prices in the nation.

For crude oil prices, which heavily influence gasoline prices, a rally sparked in part by outages in Canada and militant threats in Nigeria has faded as a stronger U.S. dollar and global demand weaken, though oil prices are up about 5 percent for the month.

Mississippi has the lowest state average in the nation at $2.05 per gallon.

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