WEX Monthly PPG Average Report for August 2014
|Los Angeles, CA||$3.93||$4.10|
|New Orleans, LA||$3.23||$3.62|
|San Francisco, CA||$4.07||$4.25|
|St. Louis, MO||$3.37||$3.58|
|National Average (US)||$3.46||$3.81|
Fading Gas Prices Likely to Continue Lower
Gasoline prices have slowly dropped most of the summer despite international turmoil that in other years would have sent the market spiraling upwards. The national average is $3.43 per gallon, almost 17 cents per gallon below where it was last year. Experts are predicting that prices will continue to decline and that many states will see stations with prices below $3.00 per gallon in the coming weeks.
Domestic crude supplies are at their greatest level since 1986 and it is forecasted to grow substantially in the next few years. Thanks to this boom and additional supplies from Canada and Mexico, the United States is now mostly insulated from the chaotic Middle-East.
Another reason prices are at bay is the increased efficiency in the fleet. With new models that get better gas mileage, demand for gasoline is about 6% lower than it was in 2007 when it peaked. Analysts see continued gains as older cars are replaced by newer models.
September 15 is the day refiners can switch to winter fuel. It is cheaper and easier to make than what is required by the EPA in the summer. This typically causes a drop in fuel prices and experts think prices will see a drop when the change happens again this year.
The Hurricane season has been very quiet with few storms threatening the refining sector. Without any threats, prices are likely to move even lower.
Diesel prices are at $3.79 and are likely to hold steady. With heating oil season on the horizon, most market watchers don’t anticipate the same kind of drops for diesel as they do for gasoline.