Gasoline prices continue spring ascent.
US retail gasoline prices started the month of May at a nearly six month high. Also, as OPIS analysts have been predicting since the beginning of the year, the average gasoline price is now greater than the US average for diesel.
The average gasoline price being higher than diesel is a relatively new phenomenon as average US gasoline at the pump has been stronger than diesel in just the past five days. Gasoline prices on the street average about 1.5-2 cents more than diesel nationally and should maintain that position through much of the 2nd quarter and likely the 3rd quarter as well.
Retail gasoline prices are starting the month of May at the highest levels since November 8. However, the current average of $2.21 per gallon is roughly 39 cents cheaper than where prices were one year ago.
In some cases, like California, current retail gasoline prices are nearly 90 cents cheaper than where they were one year ago.
Although prices continue to move higher, inventories are not necessarily considered tight. However, should demand, as measured by the EIA, continue its incredibly strong pace, a few key refinery shutdowns may quickly chew into current supplies. As measured by the EIA, gasoline demand has topped 9 million barrels per day every week since the end of January.
Crude oil prices are edging higher but continued global oversupply is keeping a lid on prices. As WTI futures have recently set 2016 highs, prices still remain in the mid $40s, and prices hitting $50 a barrel or more may not be a reality until late in the year.