Price of Gas on Fourth of July Sets Low of 12 Years
Consumers driving to their destination for the four-day weekend will be paying on average $2.21 a gallon, which is less than the $3.14 a gallon ten-year average, said an analyst from GasBuddy.com a provider in Boston of pricing data and information for retail fuel.
The site said that last summer was expected to be the least expensive since 2005, but oil production in the U.S. offset production cuts for OPEC. Headwinds for oil prices have become stronger than at any point as prices are expected to be lower for an extended period.
SUV drivers will save as much as $11 per full tank through finding less expensive gas, while a smaller car owner will save an average of $6 per tank full.
The spread between gas stations that are the lowest and those that are the highest priced as of June 30 was $1.29 a gallon.
Prices of gas have also reached another record – the average price nationwide is expected to be 12 cents less on July 4 than on New Year’s Day. That marks the first time since data was collected over 17 years ago that, that has occurred.
Over the last decade, the average nationwide has been higher July 4 by $1.04 a gallon than on New Year’s Day.
One industry analyst said that Americans will pay on average $2.25 per gallon during the July 4 weekend, which is about the same price as one year ago and 50 cents less expensive per gallon as two years ago.
Domestic oil inventories remain close to record highs as companies in the U.S. have not cut production, which will lead to prices of gas and diesel remaining down for the remainder of summer.
The recent uptick in prices of oil will not be sustainable said an oil and gas specialist in Dallas. Some of the price upswing is due to temporary factors like oil production sites shutting down due to a tropical storm that went through the Gulf of Mexico and Alaska maintenance activities.
Although the lowering in production by OPEC began last November, two members Nigeria and Libya did not agree and have not cut their production and their production and the U.S. shale production increase have caused large headwinds for the price of oil which should continue through both the 2017 third and fourth quarters.