Will falling oil prices bring relief at the pump? Kentucky down another 2 cents
AAA: Bourbon at $2.96, Jessamine at $2.98, Garrard at $2.96, Lincoln at $2.99, Boyle at $2.96 and Mercer at $2.99 are below $3
LEXINGTON, Ky. (WTVQ/AAA) — After stubbornly staying above $80 a barrel since Labor Day, the price of crude oil tumbled this week into the mid-$70s, which could help to lower gas prices―though the relief may be temporary.
Fears of slowing economic activity in the U.S. and Europe due to a resurgence of COVID-19, along with reports that the Biden Administration is calling for release of stockpiled oil by large oil-consuming nations is putting downward pressure on crude prices.
Gas prices in Kentucky also fell again this past week. Today’s average of $3.08 for a gallon of regular unleaded is 2 cents lower than a week ago. The price is now 2 cents lower than a month ago, but still $1.16 higher than a year ago at this time.
“The price of crude oil accounts for about 50%–60% of what consumers pay at the pump, so a lower oil price should translate into better gasoline prices for drivers,” said Lori Weaver Hawkins, public affairs manager, AAA Blue Grass. “But until global oil production ramps back up to pre-pandemic levels, this recent dip in the price of crude may only be temporary.”
Today’s national average of $3.40 is 3 cents more than a month ago and $1.29 more than a year ago, and 81 cents more than in 2019.
According to new data from the Energy Information Administration (EIA), total domestic gasoline stocks decreased by 700,000 barrels to 212 million barrels last week. Gasoline demand also dropped slightly from 9.26 million barrels a day to 9.24 million barrels a day. The decrease in demand, alongside stocks, has helped to steady pump prices. However, gasoline prices will likely remain elevated as long as oil prices are near or above $75 per barrel.
Central and Eastern Kentucky gas prices continue downward trend
Gas prices across Central and Eastern Kentucky continued to see modest declines in the majority of counties.
Lexington dropped a penny to land at $3.05 on the week. That’s down 4 cents from a month ago, but still $1.05 higher than this time in 2020, when demand was unusually low due to the pandemic.
At least half a dozen counties in Central and Eastern Kentucky are now averaging below the $3 mark, including Bourbon at $2.96, Jessamine at $2.98, Garrard at $2.96, Lincoln at $2.99, Boyle at $2.96 and Mercer at $2.99. Boyle is actually up 2 cents from a week ago, but still under the $3 mark while Garrard dropped 3 cents on the week and Jessamine is holding steady. Bourbon saw its average price drop a nickel on the week, while Mercer and Lincoln counties both fell 3 cents.
Other counties in the region holding near the $3 mark are Laurel at $3, and Pulaski, Mason and Woodford counties, all at $3.01, and Bell County at $3.02.
For those traveling around the region, Kentucky’s $3.08 per gallon average remains one of the lowest in the area, with several nearby states continuing to see gas prices climb. Gas on average in Kentucky remains 3 cents cheaper than in Tennessee, which saw a 2 cent drop to $3.11 on the week. Ohio is down 4 cents at $3.22, while Indiana is also down 4 cents, now at $3.32.
Prices at the pump in Kentucky continue to average 24 cents less than West Virginia, which now fell 2 cents to land at $3.34. Virginia saw a nickel drop on the week, averaging $3.25, while Kentucky is now a penny higher than Missouri, which sits at $3.07 after dropping another 2 cents on the week. Illinois remains the high spot, with gas averaging $3.58 after another 2 cent climb on the week.
Motorists can look for the cheapest gas in their area 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 or search your device’s app store.
The nation’s top 10 largest weekly changes: Florida (+9 cents), Arizona (+7 cents), Washington, D.C. (−5 cents), Michigan (−5 cents), Texas (−5 cents), Indiana (−5 cents), Ohio (−4 cents), Kansas (−4 cents), Oklahoma (−3 cents) and California (+3 cents).
The nation’s top 10 most expensive markets: California ($4.71), Hawaii ($4.34), Nevada ($3.98), Washington ($3.88), Oregon ($3.78), Arizona ($3.74), Alaska ($3.72), Utah ($3.70), Idaho ($3.69) and Pennsylvania ($3.60).
Oil Market Dynamics
At the close of Friday’s formal trading session, WTI decreased by $2.91 to settle at $76.10. Crude prices declined at the end of last week as the dollar grew in strength and market concerns about crude demand increased over growing COVID infection rates in Europe and the U.S. If social restrictions are re-imposed to curb COVID transmission, crude demand will likely decline and prices will likely follow. Additionally, crude prices decreased last week despite EIA’s weekly report showing that total domestic crude supply decreased by 2.1 million bbl to 433 million bbl. When compared to the end of November 2020, current total domestic crude supply is nearly 12 percent lower than last year.
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.
AAA is the most comprehensive resource for gas prices. Unlike the Lundberg Survey of approximately 7,000 gas stations and Gas Buddy reports which rely on customer input, AAA gas price reports reflect actual prices from credit card transactions at more than 100,000 gas stations in the U.S.