Gasoline demand has jumped from 7.53 million barrels per day to 8.11 million barrels per day, according to the latest Energy Information Administration (EIA) measurement. A jump in demand that large typically causes a comparable rise at the pump, due to a corresponding decrease in supply.
But surprisingly, the recent increase in demand had little impact on gasoline supply and only minimal impact on pump prices for many parts of the country. For the week ending Jan. 20, gasoline supply saw a small decrease of 300,000 barrels. At 245 million barrels, supply levels lag behind last year’s reading at this time by 15 million barrels.
“Most motorists continue to see gas prices increase, here in Kentucky as well as across the country. Prices in the Bluegrass, in particular, have continued to climb in most areas. But for many, those increases have been at a slower rate than the past few weeks,” said Lori Weaver Hawkins, manager, public and government affairs. “Part of that is due to more stable crude oil prices throughout January. However, if demand continues another week of substantial increases, we can expect to see pump prices get noticeably more expensive.”
At the pump, the national average increased by two cents on the week to $2.40. Kentucky’s week-over-week average edged up about 3 cents to $2.26, landing it a spot on the “top 10” greatest increases week over week.
Five states saw gas prices decrease: Michigan (-5 cents), Indiana (-5 cents), Ohio (-2 cents), North Carolina (-1 cent) and Delaware (-1 cent). The rest of the country saw nominal increases. Moreover, only three states saw gas price averages increase more than a nickel.
With the national average 15 cents more expensive than this time last month, Kentucky’s gas price average, and that of every other state, is more expensive than December. But year-over-year, motorists are still saving at the pump, on average about 12 cents, with the exception of Maryland (+4 cents). Kentucky’s average is 12 cents cheaper than this time last year, when the average for the Commonwealth was $2.38.
Gas Prices Continue Higher Across the Bluegrass
Today’s average of $2.26 in Kentucky is 12 cents more than a month ago, indicating that increases at the pump have slowed compared to the increases seen in recent weeks. Today’s gas price in Kentucky is still more than a dime lower than the Commonwealth’s average of $2.38 seen a year ago. But more dramatic increases are still the story in many parts of the Bluegrass.
In Lexington, the average price is still rising rapidly, up 12 cents from last week to land at $2.29, but just 7 cents higher than a month ago.
Surrounding communities have also seen gas prices rise in the past week, though some less rapidly. In Nicholasville, the average price is up 6 cents, now at $2.27. Georgetown is also up 6 cents, now averaging $2.29. Versailles took the biggest jump, up 13 cents to land at $2.31, while Winchester held steady at $2.29. Richmond is up 6 cents, landing at $2.34.
Owensboro is the community with the lowest price in Kentucky at $2.14. The high spot in the Commonwealth remains Louisville, rising a dime since last week to land at $2.38.
The nation’s top 10 largest weekly increases: Florida (+9 cents), Utah (+9 cents), Nebraska (+5 cents), Idaho (+4 cents), Louisiana (+4 cents), California (+3 cents), Illinois (+3 cents), Nevada (+3 cents), Kentucky (+3 cents) and Connecticut (+3 cents).
The nation’s top 10 least expensive markets: Mississippi ($2.09), Oklahoma ($2.11), Texas ($2.11), Missouri ($2.12), Louisiana ($2.14), South Carolina ($2.16), Arkansas ($2.17), Alabama ($2.17), Kansas ($2.18) and Tennessee ($2.19).
Oil Market Dynamics
At the close of Friday’s formal trading session, WTI decreased by 86 cents to settle at $52.36. Crude prices declined last week following market concern that crude demand may suffer as coronavirus infections rise and travel restrictions, which are meant to curb transmission of the virus, reduce crude demand. Additionally, EIA’s latest weekly report revealed that total domestic crude inventories rose by 4.4 million barrels to 486.6 million barrels, which also put downward pressure on crude prices. For this week, crude prices may continue to drop if market concern regarding demand continues to grow.
Motorists can find current gas prices along their route with the free AAA Mobile app for iPhone, iPad and Android. The app can also be used to map a route, find discounts, book a hotel and access AAA roadside assistance. Learn more here.
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