Gas prices continue rising to close out summer driving season

(August 30, 2016) After dropping for two months, including a streak of 53 of 54 days, pump prices are again on the rise heading into Labor Day weekend. The national average price for regular unleaded gasoline has increased for 14 consecutive days. Today’s average price of $2.22 per gallon marks an increase of six cents per gallon compared to one week ago and eight cents per gallon compared to one month ago, according to AAA.

Despite the increase, drivers are paying 27 cents less than they did at this same time last year and are on track to pay the lowest Labor Day gas prices since 2004.

According to a AAA survey, 55 percent of Americans say they are more likely to take a road trip this year due to lower gas prices. OPIS projects that Americans will purchase about 400-million gallons of gasoline each day over Labor Day weekend, at an aggregate cost of about $880-million per day. While the national year-over-year discount remains, it has closed substantially from more than fifty cents just ten days ago.

A number of factors have been driving prices higher for motorists including — higher crude oil prices, refinery issues in the Gulf Coast, and the threat of a tropical weather system moving into the Gulf of Mexico.

The rising crude oil prices can be attributed, in part, to talks of an agreement to limit production amongst OPEC countries and news from the U.S. Federal Reserve that the U.S. may raise interest rates in the next couple of months.

While Midwest prices have often been the most volatile in the nation in recent years, prices in Southern and East Coast states over the last week have headlined the list of biggest movers. This has been largely tied to refinery issues in the Gulf Coast including flooding at the Baton Rogue Exxon Mobil and Covent facilities and a refinery outage in Baytown, Texas, which have pressured prices higher in areas supplied by these facilities.

Meanwhile, the first major tropical depression moved through the Straits of Florida, the area between Cuba and the Florida Keys, Sunday evening. While the storm’s direction and strength are still uncertain, many meteorologists are tracking the storm’s path into the Gulf of Mexico with a northern bend into Florida later in the week. The storm’s projected move away from the concentration of refineries and petroleum infrastructure in the Gulf Coast is easing worries about available supply.

Quick stats

Gas prices in three states are below $2 per gallon, six fewer than one week ago: South Carolina ($1.95), Alabama ($1.98) and Mississippi ($1.996).

States around the country have seen volatility in gas prices including drivers in the Great Lakes region, the Rockies, central and southern states. The biggest weekly increases in price are seen in Florida (+13 cents), Tennessee (+9 cents), Georgia (+9 cents), Missouri (+8 cents), Kansas (+8 cents), North Carolina (+8 cents), South Carolina (+8 cents), Colorado (+8 cents), Michigan (+7 cents) and Illinois (+7 cents).