AAA: Gas prices soaring, will climb higher
The Daily Reflector
Tuesday, April 24, 2018
As the demand for gasoline reached record levels nationally, gas prices in the Greenville area continue to climb this week, reaching the highest average prices since the summer of 2015, according to AAA Carolinas and local price sourcing sites.
The average price for a gallon of regular gas on Monday in Greenville was $2.70, with highest prices at about $2.79 at the Speedway on South Memorial Drive and the lowest at about $2.67 at City Gas on North Greene Street, according to the AAA and Gas Buddy.com gas price listings websites.
Greenville’s gas prices are among the highest in North Carolina, the data indicated. The statewide average price for a gallon of regular gas is $2.65 per gallon, while the national average is $2.76, AAA Carolinas reported. Greenville motorists were noticing the price hikes at the pump Monday, but were feeling helpless.
“I ain’t too happy about this,” said Levonder Kelly, an independent electrical contractor from Greenville. “I don’t know why it’s going up. Who controls that? It affects my bottom line but I guess there’s not much we can do about it; I still have to use my truck (a Chevy Avalanche) for work. If push comes to shove, I’ll have to get a smaller vehicle.”
At the Speedway station on South Memorial Drive, Terrence Matthewson of Robersonville said he almost drove by when he saw the price.
“I realized I still need gas,” Matthewson said. “It was a lot better when it was $2.30 not that long ago, but it’s better than $3 a gallon, I guess. I’ve given up those extra runs to the store and now I get everything at one time.”
At the close of Friday’s formal trading session on the New York Mercantile Exchange, West Texas Intermediate oil (a benchmark used for oil pricing) increased 9 cents to settle at $68.38 per barrel, which is the second highest close for that grade since Dec. 1, 2014, according to the AAA report.
What’s accounting for the soaring prices? The U.S. Energy Information Administration weekly report revealed that crude inventories across the U.S. dropped by a combined 1.1 million barrels last week, according to the AAA Carolinas report. They now sit at 427.6 million barrels — nearly 105 million barrels lower than their level in mid-April 2017. If EIA’s report this week reveals another inventory draw, crude prices are likely to continue climbing, AAA analysts said.
That information combines with the latest data that registers consumer gasoline demand at 9.857 million barrels per day. That is the highest level ever on record for the month of April and exceeds typical summer demand measurements, they reported. As demand skyrockets, gas prices increased across the U.S.during the past week, with five states seeing double-digit jumps. The national average ticked up a nickel to $2.76.
The year-over-year decline in oil inventories is a result of OPEC’s agreement with large non-OPEC producers to reduce crude production by 1.8 million barrels per day, put into place in January 2017, according to AAA reports.
The agreement is supposed to remain in effect until the end of 2018, but last week Russian Energy Minister Alexander Novak said that producers in the agreement may begin easing output curbs sooner because the agreement has cleared out the glut of crude that the producers aimed to reduce, they said.
Saudi Arabia, a leading member of the cartel, is likely to push back on any efforts to end the production reduction agreement prior to the end of the year because West Texas Intermediate prices could reach $80-$100 by that time, AAA said.
Trevor Gentile of Greenville, a student at Pitt Community College and part-time employee at Meridian Park who lives on a tight budget, said he and his co-workers couldn’t help noticing how quickly the prices are rising.
“I know gas prices go up, but it usually trickles up. This is a big hit happening pretty quickly,” Gentile said. “Last week, I got gas while I was at lunch. My co-worker went there 20 minutes later and it was 10 cents higher. People are talking about the gas prices now, especially when they change so drastically and so fast.”
Gentile was unconvinced about demand causing the price rise.
“I don’t buy that,” he said. “If that’s true, why don’t prices ever drop as fast and far as they rise?”
Contact Michael Abramowitz at firstname.lastname@example.org or 252-329-9507.