The national average price for a gallon of gasoline more or less stable, mirroring trends for crude oil prices, according to a report from AAA. Photo by Gary I Rothstein/UPI... | License Photo
March 7 (UPI) -- Steady crude oil prices kept U.S. retail gasoline prices in check, though some regions posted major swings on the back of refinery issues, AAA reported.
AAA listed a national average retail price for a gallon of regular unleaded gasoline at $2.31 for Tuesday, down a fraction of a penny from the previous day, but up about 2 cents from the previous week. Gasoline prices one month ago were 4 cents, or about 1.7 percent higher, highlighting some of the market's stability.
"Retail prices continue to fluctuate but have remained between $2.28-2.32 for more than a month as reports of increased U.S. production continues to counter OPEC rebalancing efforts," the motor club said in a weekly market report.
Crude oil prices have been steady around $55 per barrel for most of the year. A decision led by members of the Organization of Petroleum Exporting Countries to limit production put a floor under crude oil prices at $50 per barrel. That price point is attractive enough to bring companies back to more expensive basins like U.S. shale and is keeping oil prices from moving much beyond $55 per barrel.
The price for Brent crude early Tuesday was close to an even $56 per barrel. The highest close for Brent this year was $56.34 on Feb. 21. Most of what consumers pay for gasoline is a reflection of crude oil prices.
By region, the West Coast is the most expensive market in the nation, with California's $2.99 per gallon topping the list for a state average in the Lower 48. Refineries in that market are running at reduced rates after making the switch to a summer blend of gasoline, which is more expensive to make because of the additional environmental steps needed to reduce volatility during warmer months. Several refineries in the region are running slower because of unplanned maintenance due to factors outside the seasonal shift in gasoline blends.
The Great Lakes states hold the distinction as the most volatile market in the region, with Michigan taking top honors with a price increase of 12 cents from last week to $2.40 per gallon. A bout of severe weather that spawned rare late-winter tornadoes last week caused power outages for at least two area refiners and problems at an oil-processing unit at a Phillips 66 refinery in Illinois caused further headaches for the region's drivers.
The federal government estimates a national average price for gasoline at $2.33 per gallon for March and a full-year average price of $2.39 per gallon.
AAA said oil price dynamics may be the short-term factor to watch as non-OPEC members, namely Russia, could make or break the effort to balance the market.
"Traders will continue to watch how the market reacts to increased U.S. oil production and look for signs as to whether or not Russia implements production cuts," AAA's report read.