Rising seasonal demand and higher crude oil prices have resulted in the highest average U.S. gasoline prices in nearly six months, with the national average gas price hitting $3.57 per gallon, up from $3.10 at the start of the year, and higher than a year ago.
The national average hit a new multi-month high on Thursday morning, rising to $3.57 per gallon, the highest since October 14, Patrick De Haan, head of petroleum analysis at GasBuddy, noted.
The current average price of a gallon of regular gasoline is some 20 cents higher than the $3.352 average one month ago, according to data from AAA, and is 7.2 cents per gallon higher than at this time last year, De Haan added. At this time last year, the national average price was at $3.507 per gallon.
The rise in prices this week follows a week of barely changed prices.
After climbing for four straight weeks, the national average was unchanged on Monday compared to a week ago at $3.51 per gallon, GasBuddy’s De Haan wrote earlier this week.
“While we seem to be nearing a short-term peak, one word of caution for those in the Mid-Atlantic and Northeast: you haven’t yet finished the transition to summer gasoline, so you may experience some sticker shock in a few weeks,” the analyst said.
This week, WTI Crude prices topped $85 per barrel amid signs of tightening global crude supply. Moreover, demand continued to rise with the warmer weather and the Easter weekend.
The EIA’s weekly report on Wednesday showed a draw in gasoline stocks, implying stronger demand. Gasoline inventories shed 4.3 million barrels in the week to March 29, with production averaging 10 million bpd. These figures compared with an inventory build of 1.3 million barrels for the previous week, when production stood at an average of 9.2 million barrels daily.
Meanwhile, as reported previously, JPM sees oil rising to $100 or higher if Russia fails to boost output. Such an outcome would be catastrophic for Biden in the months ahead of the presidential election, and according to JPM commodity strategist Natash Kaneva, the senile occupant of the White House could drain some more oil from the already mostly depleted SPR (which earlier this week he said he would no longer refill as oil prices had gotten too high). JPMorgan estimates the Biden administration "has the policy space to release up to 60 mn bbls of crude oil, boosting supply by 0.5 mbd per month if spread over four months."
How Biden would spin such a clearly political move as a national emergency emergency is unclear - he may need to start another war or two - but it almost certain that he will try.
