The national average price of gasoline decreased during March for the first time in 10 years, and gas prices now average nearly 30 cents per gallon less than a year ago. The national average should remain less expensive than last year’s prices this spring.
“It is very unusual for gas prices to decline in early spring like we have seen this year,” said AAA South Dakota spokeswoman Marilyn Buskohl. “An increase in refinery production and lower oil prices in early March have combined to provide rare falling prices for motorists in comparison to recent years.”
This week marks the one-year anniversary of the 2012 peak in gas prices, when the national average reached $3.94 per gallon on April 5 and 6. Gas prices peaked in 2011 at $3.98 per gallon on May 5.
Gas prices declined in March as many refineries resumed normal operations following the completion of seasonal maintenance. The price of West Texas Intermediate (WTI) crude oil also remained relatively low for much of the month.
Gas prices spiked in late January through February primarily because of supply concerns with refineries in February, which processed the lowest amount of crude oil in nearly two years due to extensive maintenance and facility upgrades.
AAA predicts gasoline prices nationwide in April should remain less expensive than in recent years because oil is cheaper and refinery production is rising. The price of WTI crude oil is about $6 per barrel less than a year ago, while refinery utilization has increased by about five percent since early March, according to the federal Energy Information Administration.
“AAA has no record of national gas prices ever peaking in February, and it is too early to say whether prices may have hit a high for the first half of the year,” said Buskohl. “While it is possible that gas prices may surge briefly again this spring, the national average should remain less than last year’s high of $3.94 per gallon due to increased domestic production and continued low demand.”
Much of the country must transition to more expensive summer-blend gasoline and there is still refinery maintenance left to complete, which could result in a brief surge in gas prices.
Despite experiencing the two largest month-over-month increases at the pump, motorists in Wyoming and Montana still pay the least in the nation for a gallon of gasoline at $3.33 and $3.36 respectively. Drivers in three states pay an average of more than $4.00 per gallon today: Hawaii $4.38, Calif. $4.05 and Alaska $4.01.
While retail gas prices declined steadily in March, oil prices crept higher on signs of continued economic recovery. West Texas Intermediate (WTI) began the month with what was at the time its lowest settlement of the year ($90.68 per barrel) before rising to end March at its highest price since February 14 ($97.23). Prices retreated slightly yesterday as WTI settled 16 cents lower at $97.07 per barrel at the close of formal trading on the NYMEX.
AAA updates fuel price averages daily at www.FuelGaugeReport.AAA.com. Every day up to 120,000 stations are surveyed based on credit card swipes and direct feeds in cooperation with the Oil Price Information Service (OPIS) and Wright Express. All average retail prices in this report are for a gallon of regular gasoline.
Learn where the cheapest gas stations are, read about fueling myths, and access a wealth of fuel-related information at http://www.sd.aaa.com/news/fuel and see how to save money on gas with a few simple tips from AAA.
A not-for-profit organization, AAA South Dakota serves its 92,400 members across South Dakota with emergency help on the road, auto travel assistance and a wide range of personal insurance, travel, financial and automotive services through branch offices, and the Internet at AAA.com.