Gas prices continued to hold steady for the second straight week, a welcome pause at the pump for motorists. After holding steady at an 18-month high of $2.86 a gallon, the national average price for regular grade gasoline dropped a penny to start the weekend at $2.85 a gallon. Current prices are 79 cents higher than a year ago, but still $1.26 less than the record high set in July 2008.
Crude oil began the week drifting down toward the $80/barrel mark on the heels of the surprise allegations of fraud made against Goldman Sachs by the SEC at the end of last week. Compounded by continued economic uncertainty coming from Greece, as well as poor U.S. unemployment and consumer sentiment data, emphasizes lingering concerns over the pace of the global economic recovery. However, earlier losses were reversed as news came Friday that Greece would accept financial aid from European Union/International Monetary Fund. Crude oil rebounded Friday to close at $85.12.
In its weekly report, the Energy Information Association (EIA) showed crude stocks rose 1.9 million barrels to 355.9 million barrels, against a forecasted 300,000 barrel draw and the American Petroleum Institute’s (API) 741,000 barrel drop. Crude stocks have risen in 11 out of the last 12 weeks. Gasoline stocks rose 3.6 million barrels to 226.9 million barrels, far greater than the forecasted 400,000-barrel increase and contrary to the API’s 1.7 million barrel drop.
The Weekend
“Historically, gasoline prices tend to spike in April and May, and then reach their high water mark for the year during the summer driving season, so the fact that pump prices have stabilized of late is good news for motorists,” said Tracy Noble, Manager of Public and Government Affairs for AAA Mid-Atlantic. “Some analysts think we might very well be past the seasonal peak in gas prices and that we might not hit the pivotal $3.00 a gallon mark. Nationwide, consumers are currently spending approximately $1.07 billion each day for regular blend gasoline and they don’t have the stomach or the stamina for paying much more.”
The Week Ahead
The market will keep an eye peeled for any negative financial news, national or international that could send crude oil and gas prices back on an upward climb. In the week ahead we may see some additional fallout from the eruption of a massive volcano in Iceland that had blanketed Europe with ash and suspended air travel for over a week. Lower demand for jet fuel for the short term and potential economic damage to Europe could aid in strengthening the U.S. dollar against the euro and push crude oil down.
CURRENT AND PAST GAS PRICE AVERAGES
Regular Unleaded Gasoline (*indicates record high)
4/25/10 | Week Ago | Year Ago | |
National | $2.85 | $2.87 | $2.05 |
New Jersey | $2.72 | $2.69 | $1.92 |
Trenton | $2.74 | $2.71 | $1.94 |
Cape May County | $2.72 | $2.70 | $1.92 |
Burlington County | $2.69 | $2.67 | $1.92 |
Middlesex, Somerset, Hunterdon | $2.73 | $2.70 | $1.93 |
Monmouth, Ocean Counties | $2.71 | $2.69 | $1.91 |
Crude Oil | $85.12 per barrel (close on Friday) | $83.24 per barrel | $50 per barrel |
