Concerns about global supplies nudged pump prices up, but this rise may be short lived.
WASHINGTON, D.C. — Fewer U.S. drivers are fueling up lately, yet the national average gas price rose 4 cents over the past week to reach $3.80 per gallon.
One reason for the increase is worries over Russian oil production cuts that could affect global supplies. However, this rise in prices could be short-lived due to new COVID-19 restrictions in China that signal a potential economic slowdown for the top oil-consuming country in the world, AAA reported.
"The oil market, like the stock market, hates negative headlines, no matter how speculative," said Andrew Gross, AAA spokesperson. "And that is why we see the oil price back over $90 a barrel. More expensive oil usually leads to more expensive gasoline, but the recent COVID-related news from China may stem this increase."
The latest data from the U.S. Energy Information Administration (EIA) shows that gas demand saw a slight decrease from 8.93 million barrels per day to 8.66 million barrels per day last week, while total domestic gasoline stocks decreased by 1.3 million barrels to 206.6 million barrels. Tighter supply and fluctuating oil prices put upward pressure on gasoline prices, and prices at the pump could increase if supply remains tight alongside rising oil prices.
The current national average of $3.80 is 9 cents less than one month ago and 38 cents more than one year ago.
The largest weekly increases took place in Indiana (37 cents per gallon), Wisconsin (31 cents), Michigan (27 cents), Ohio (21 cents), Illinois (17 cents), Florida (16 cents), Kentucky (12 cents) and Delaware (10 cents).
The largest weekly decreases took place in Oregon (13 cents) and California (11 cents).
The top 10 least expensive markets are Georgia ($3.12 per gallon), Texas ($3.17), Mississippi ($3.20), Arkansas ($3.24), Louisiana ($3.26), Tennessee ($3.28), South Carolina ($3.28), Alabama ($3.30), North Carolina ($3.36) and Missouri ($3.36).
At the close of the formal trading session on Nov. 4, West Texas Intermediate rose by $4.44 to $92.61. Crude oil prices spiked at the end of the week after the dollar fell in value, while the price of oil rose after the EIA reported that total domestic crude stocks had declined by 3.1 million.
However, crude oil prices could face headwinds this week if market concerns regarding a possible recession persist, AAA reported. If economic growth stalls or reverses course, crude demand will likely follow alongside prices.