Travel club AAA on Monday put the national average retail price of $3.54 for a gallon of regular unleaded gasoline, relatively unchanged from week-ago levels. An increase in the price of crude oil, which accounts for the bulk of what consumers see at the pump, in response to decisions by Saudi Arabia and Russia to trim production has yet to trickle down the consumer.
The price for Brent crude oil, the global benchmark for the price of oil, is up nearly 4% over the last week. Refineries, meanwhile, are running at close to peak capacity, which may help explain the stability of retail gasoline prices while crude oil prices rally.
Some regions are starting to see a decline in the price at the pump. For Michigan, which is usually in the top tier for gasoline prices due to elevated state taxes, the price at the pump is down 7 cents from this time last week and 17 cents lower than this time in June.
"Michigan motorists are seeing a decline in prices at the pump compared to last week," Adrienne Woodland, a spokeswoman for AAA, told The Detroit Free Press. "If demand continues to rise, drivers could see gas prices increase."
Demand at the national level is already on the rise. Over the four-week period ending June 30, the total amount of motor gasoline supplied to the market, a proxy for implied demand, came in 3.5% higher than this time last year.
Gasoline prices are highly volatile and not all states are seeing declines. The price at the pump in Florida, which relies heavily on other states for piped supplies of gasoline, is up about 20 cents from this time last week.
Nationally, the Energy Department in a monthly report for June forecast an annual retail average of $3.39 for a gallon of regular unleaded gasoline, 58 cents lower than the full-year average for 2022. A revised estimate is expected on Tuesday.
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