Retail gasoline prices this summer approaching to be lowest given 2004

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The U.S. Energy Information Administration forecasts that U.S. drivers will compensate an normal of $2.04 per gallon (gal) this summer for unchanging gasoline, according to EIA’s Short-Term Energy and Summer Fuels Outlook. The foresee cost for summer 2016 (which runs from Apr by September) is 59 cents/gal reduce than a normal cost final summer, and it would be a lowest normal summer cost given 2004. Monthly normal gasoline prices are approaching to boost to $2.08/gal in June, afterwards tumble to $1.93/gal in September.

Image credit: U.S. Energy Information Administration

Image credit: U.S. Energy Information Administration

In a United States, somewhat some-more than half of a vehicle-miles driven in a year start in a 6 months from Apr by September. For a full-year 2016, EIA forecasts U.S. unchanging gasoline prices to normal $1.94/gal. Based on this annual normal price, EIA estimates a normal domicile will spend about $350 reduction on gasoline in 2016 than in 2015 and about $1,000 reduction than in 2014, when sell gasoline prices averaged some-more than $3/gal.

Gasoline prices have 4 categorical components: wanton oil prices, indiscriminate margins, sell placement costs, and taxes. Because a latter dual are generally stable, movements in gasoline prices are essentially a outcome of changes in wanton oil prices and indiscriminate margins. Each dollar per tub of postulated cost change in wanton oil and/or gasoline indiscriminate margins formula in a change of 2.4 cents/gal in product prices.

Gasoline prices in a United States typically simulate changes in a Brent tellurian oil benchmark. The Brent wanton oil cost is foresee to normal $35/barrel (83 cents/gal) this summer, about $22/barrel (50 cents/gal) reduce than final summer. Crude oil prices are reduce this year given tellurian oil reserve have continued to surpass consumption, heading to steadfastly vast register builds. EIA expects these register builds to insist by 2016, gripping wanton oil prices next $40/barrel.

EIA expects indiscriminate gasoline margins (the disproportion between a indiscriminate cost of gasoline and a Brent wanton oil price) will normal 47 cents/gal this summer, about 13 cents/gal reduce than final summer. Gasoline prolongation has been aloft recently, and several of a serious refinery outages that caused high prices final summer (particularly on a West Coast) have given been resolved or accommodated by receiving supply from other sources. Regional differences in sell gasoline prices can be significant, and EIA forecasts normal summer prices to operation from a low of $1.80/gal on a Gulf Coast to $2.51/gal on a West Coast.

Source: EIA