New England States See Another Week of Savings at the Pump

AAA-Gas-Prices

Gas prices continue to decline in New England. The price drop is due to a continued buildup of crude oil combined with ongoing high gasoline production runs, an increase in gasoline stocks and a drop in gasoline demand.   If refiners continue to produce record amounts of gasoline and oversupply the market, consumers will reap the benefit and see slight fluctuations in gasoline prices (+/- a few cents) in coming weeks. However, it is not likely that gas prices will drop much lower than this week’s prices.

 

“If oil prices continue to be below $50 a barrel, there is a strong chance that prices could continue to drop,” said Dan Goodman, manager of public affairs for AAA Northern New England.

 

  • Vermont’s average current price is $2.36 per gallon, which is 3 cents lower than one week ago, and 1 cents higher than one year ago.
     
  • New Hampshire’s average current price is $2.25 per gallon, which is 4 cents lower than one week ago and 3 cents lower than one year ago.
     
  • Maine’s current price is $2.30 per gallon, which is 4 cents lower than one week ago and 6 cents lower than one year ago.
     
  • Massachusetts current price is $2.32 per gallon, which is 3 cents lower than one week ago and the same price as one year ago.

 

 

Oil Market Dynamics

The price per barrel closed Thursday at $44.61. This comes after last week’s report from the EIA showed surprising numbers in gasoline demand and crude inventories. After setting a record for use during the run-up to Memorial Day weekend, demand tumbled down by approximately 505,000 barrels per day. Market watchers expected to see a post-Memorial Day slump; however, the market was surprised by a strong build in crude inventories – a large increase of 3.3 million barrels. This figure re-emphasized that the market continues to see a substantial glut in crude inventories, resulting in high production rates putting downward pressure on prices per barrel.
 

At the end of last week, Baker Hughes, Inc. released its latest rig count report, revealing eight oil rigs had been added for the week. The U.S. now has 741 active oil rigs, an impressive number considering global concerns about the oversupply of crude in the market causing prices to trend downward. As expected, the continued growth puts more oil in the pipeline for gasoline production. With refineries still processing a lot of gasoline – measured in EIA’s recent report at over 17.5 million barrels per day – and a drop in demand, gasoline stocks around the country are continuing to grow. Price drops at the pump reflect this trend, and as the summer driving season zooms ahead, U.S. drivers may see drops continue into July and August.

 

Motorists can find current gas prices along their route with the free AAA Mobile app for iPhone, iPad, and Android. The app can also be used to map a route, find discounts, book a hotel, and access AAA roadside assistance. Learn more at AAA.com/mobile.