Since Monday, the national average for a gallon of regular gasoline has increased two cents to $3.19, tying early August peaks and matching a 7-year-high. Much of the rise is due to impacts from Hurricanes Ida and Nicholas on oil and refinery production. Approximately 30% of crude production in the Gulf of Mexico remains shuttered, according to the U.S. Bureau of Safety and Environmental Enforcement. Reduced crude production combined with gradual refinery restarts has led to a drop in percent of crude utilization nationwide by just over 9% to 82.1%, according to the most recent weekly report from the Energy Information Administration (EIA), when compared to the last week of August — a few weeks before the storms impacted the market. Meanwhile, total domestic stocks took another step back by 2 million bbl to 218 million bbl. As the recovery process continues, reduced crude production and refining capacity will likely cause prices to fluctuate through the weekend. Some states have already seen a 9 cent jump over last week, while others dropped by 3 cents.
At the close of Thursday’s formal trading session, WTI remained unchanged at $72.61. Although crude prices remained unchanged today due to a stronger dollar, prices have primarily increased this week due to the market reacting to impacts from Hurricanes Ida and Nicholas. The price per barrel hit a high this week of $72, a level not seen since July. Industry reports show that Hurricane Ida has reduced crude supplies by about 30 million bbl, causing a month-to-month reduction of the global supply of 540,000 b/d. Domestically, tightened crude supplies will likely be offset by less gas demand after Labor Day, which decreased from 9.61 million b/d to 8.89 million b/d in EIA’s new weekly report. However, the impact of the hurricanes and the latest crude price increases could help pump prices remain elevated in the weeks ahead.
Largest Weekly Changes
- Since last Thursday, these 10 states have seen the largest changes in their averages: Florida (+9 cents), Ohio (+7 cents), Illinois (+6 cents), Indiana (+5 cents), Pennsylvania (+4 cents), Nevada (−4 cents), Michigan (−3 cents), Washington, D.C. (+2 cents), Colorado (−2 cents) and Utah (−2 cents).