The average U.S. gas price is now $3.58 a gallon, down from nearly $3.75 a year ago.
Analysts speculate that this is the result of a rise in crude oil production and a decrease in consumer demand. “We have seen rising crude oil inventories playing a role in lower gasoline prices,” Patrick DeHaan, senior petroleum analyst at Gasbuddy.com, tells The Daily Ticker. “Last year there were a few major refinery incidents. Really we’ve had a lack of unexpected refining problems and that’s kept pressure at the gas pump down."
DeHaan explains that the decrease in consumer demand is due to changed habits induced by higher gas prices. “Higher gas prices have led to demand destruction,” says DeHaan. “Americans have made some permanent changes to their lifestyle, perhaps their driving habits as well that are keeping demand from moving higher. Let’s face it, the economy is still in a fragile recovery mode and that’s leading some people to consume less gas than they would otherwise.”
Many Americans are enjoying lower gas prices this spring, and Energy Department analysts have said they expect the average price to remain low at $3.53 per gallon this summer. But DeHaan disagrees.
“We will most likely see the national average float higher as we approach Memorial Day,” he says, “But the good news is that once we make it through Memorial Day weekend prices will contract in the month of June; they may remain in the mid-three dollar range.”
Prices may take a turn for the worse during the hot months of July and August. “There is more risk in the month of late-July to early August, that’s when hurricane season is in its prime. We could see prices be affected by any major storm so we could see prices go higher in the summer.”
The bottom line?
“If you’re looking to take that summer vacation June does seem to be a pretty good month in terms of gasoline prices,” says DeHaan
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