REXBURG – Less pain at Gem State gas pumps is being reported by the American Automobile Association this month.
The AAA reported on Wednesday that Idaho’s average gasoline prices are on the average around $2.87.
“(That’s) eight cents less than a month ago and 35 cents less than a year ago. Things are looking good in the Gem State,” stated Idaho AAA official Matthew Conde.
Gasbuddy.com reports that fuel prices in Rexburg range from $2.64 to $2.74 a gallon.
“It’s unusual to see prices drop throughout the summer, especially when record-breaking numbers of people have traveled for most of the major holidays. But that’s exactly what’s happened in Idaho since Memorial Day,” he said. “With kids going back to school and an upcoming switch to winter-blend fuel, prices could drop even further in coming weeks.”
Nationally, fuel prices are also lower than normal, Conde said.
“The U.S. average price is $2.64, which is 15 cents less than a month ago and 22 cents less than a year ago. Idaho currently ranks 8th in the country for highest gas prices,” he said.
Conde reported that “winter-blend” fuels are cheap to produce. That’s because such fuels don’t need certain additives necessary to prevent evaporation during warmer weather.
“The switch to winter-blend takes place every fall, and generally coincides with a drop in fuel demand after Labor Day,” he said.
Conde noted that in the Rockies, refineries maintained a “frenetic pace” during the summer.
“(They) currently lead the nation with a 103 percent utilization rate. That’s important, because the region also has the smallest stock level for gasoline at 7.5 million barrels. Even a modest reduction in supply can put significant upward pressure on gas prices during the busy travel season,” he said.
It’s possible for refineries to temporarily exceed a 100 percent utilization rate when they leverage “unexpected efficiencies in the production process.” Such won’t last long as refineries tend to slow down production for seasonal maintenance and switch to winter-blend fuel, Conde reported.
“According to the Energy Information Administration, U.S. gasoline stocks increased by 4.4 million barrels last week, a surprising change on the national level,” he said.
Conde also reported that West Texas Intermediate price for crude oil was $57 per barrel after the market closed on Tuesday. Such is $3 less than in July, and $10 cheaper than in 2018.
“Industry experts continue to believe that there is an abundance of crude oil in the market, and that the global economy could slow down in the latter half of the year due to trade tensions between the United States and China,” Conde said.
Yet, rices could jump before the end of the year as, OPEC considers additional crude oil production cuts, which the group plans to discuss in December. Should this happen, crude oil prices could increase by the end of this year.
Conde also noted that the Hurricane season doesn’t appear to be as rough as it was been in the past, but should that change in the Gulf Coast or along the eastern seaboard, fuel prices could increase prior to Labor Day.
“There are plenty of other ways that motorists can stretch their gas money,” Conde said. “If you aren’t going to use the cargo carrier on your roof rack any time soon, remove it to improve your vehicle’s aerodynamics. Bundle your errands, and carpool whenever possible.”
For more information on fuel prices call 1-800-999-9391 and ask for the AAA News Hotline.