CINCINNATI — Pump prices continue to tumble as oil prices drop to lows not seen since August amid fears of a COVID-19 fueled economic slowdown.
The national average for a gallon of gas dipped 4 cents on the week to $3.35, the lowest national average in a month and a half. And, here in Connecticut, the average price today for a gallon of regular unleaded is $3.53, down two cents from a week ago.
“As usual, the price of oil is the most significant factor in the price consumers are paying for gas so, as oil comes down, so do pump prices,” says Kara Hitchens, spokesperson for AAA. “Unfortunately, this downward trend comes as a result of fears around the new COVID variant.”
The price of oil has fallen into the mid $60s per barrel — down from the mid-80s in October. Also helping to ease upward pricing pressure was the decision by OPEC and its oil-producing allies not to cut production.
On December 2, OPEC and its allies, a group referred to as OPEC+, announced it would stick to its plan, for now, to raise production by 400,000 b/d in January. The move was likely in response to the Biden Administration’s call to increase supply to tame high fuel prices.
According to new data from the Energy Information Administration (EIA), total domestic gasoline stocks increased by more than 4 million bbl to 215,422 million bbl last week. Meanwhile, gasoline demand dipped from 9.3 million b/d to 8.8 million b/d. The slight decrease in demand contributed to falling prices, while lower crude prices also put downward market pressure on pump prices.
Monday’s national average of $3.35 is seven cents less than a month ago and $1.19 more than a year ago.
Market dynamics
At the close of last week’s formal trading session, WTI decreased 24 cents to settle at $66.26. Crude oil prices decreased last week due to uncertainty of the COVID-19 omicron variant’s impact on demand and the announcement that OPEC+ will ramp up production by 400,000 b/d in January.
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 at AAA.com/mobile.
