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Feb. 6 (UPI) -- Trends in the commodities sector may be moving in favor of U.S. consumers as moderation in the price of crude oil translates to lower prices at the pump, a Chicago-based analyst said. Travel club AAA lists a national average retail price of $3.47 for a gallon of regular unleaded gasoline on Monday, down about 3 cents from last week and close to year-ago levels of $3.44 per gallon.
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Prices had flirted with $3 per gallon at the end of last year, but have been on a steady rise since early January. That is until now.
"For the first time in 2023, the national average price of gasoline has seen a weekly decline, primarily thanks to a sharp and sudden drop in the price of oil," said Patrick De Haan, the head of petroleum analysis at GasBuddy.
The price of crude oil was on the rise on Monday. The price for Brent crude oil, the global benchmark, was up about 0.75% to trade at $80.52 when the market opened on Wall Street at 9:30 a.m. EST.
The rally was likely driven by a Turkish decision to limit pipeline capacity after two major earthquakes rocked the region early Monday.
That spike, however, should be short-lived given lingering concerns about a global recession and lackluster consumer demand. The price for Brent crude oil is down about 7% from week-ago levels.
DeHaan added gas prices usually slump in February anyhow because of the usual post-holiday decline in travel.
"However, especially for gasoline, high levels of coming maintenance and the eventual transition to summer gasoline could lead today's declines to reverse down the road," he said. "For now, motorists should enjoy the decline, but be wary as we're likely to eventually see increases again down the road."
Refiners are already on the back foot following an arctic blast in December and tornado activity in January that limited some operations. There's a regular period of seasonal refinery maintenance to go through before the May deadline to start making the summer blend of gasoline, which is more expensive to make because of the additional processing steps needed to keep it from evaporating during warmer months.
The price at the pump could reach $4 per gallon during the summer on the back of a busy travel season, but it's unlikely consumers will see $5 for a national average like last year. The federal government is forecasting a full-year average of $3.32 per gallon, compared with a full-year average of around $3.97 for 2022.
