In a sign that oil prices and an extremely cold winter have affected gasoline prices, those prices are now more than $3 per gallon for regular in all 50 states. Even states in which the prices tend to be pushed down by proximity to supply and refineries, prices have not remained below the threshold.
According to GasBuddy, only a few states have prices below $3.15. These include Montana, South Carolina, Utah, New Mexico, Louisiana, Mississippi, Wyoming, Missouri and Arkansas. Even oil-producing states Texas and Oklahoma have prices that have inched up toward $3.20. The average price of a gallon of regular nationwide is $3.34.
At the far end of the spectrum of high gas prices are several states that among them have well over a quarter of the nation’s population. The average price of a gallon of regular is above $3.60 in California and New York, and above $3.50 in Michigan, Illinois and Pennsylvania. In most cities along the coast between San Francisco and San Diego, the price has risen to more than $3.70.
Oil prices continue to sit above $100 a barrel. That is unlikely to change in the near term. Crude prices have risen recently for several reasons, most of which will not be short-lived. Economic growth in China has picked up by most measures. The People’s Republic is the largest importer of crude in the world, based on most research about energy use and trade. Home heating oil demand has spiked because of an unusually cold winter in the Northern Hemisphere. The freeze, particularly in the United States, has not shown any trend toward easing.
Several factors could constrain global crude production. According to the International Energy Agency’s Oil Market Report for February:
OECD oil demand growth rebounded in the second half of last year, but non‐OECD countries still accounted for more than 90% of global growth of 1.2 mb/d for 2013 as a whole, and will make up all of the 1.3 mb/d increase forecast for 2014, as the OECD resumes its structural decline. Demand growth is expected to accelerate in 2014 in line with the broader economy.
That “demand growth” may keep upward pressure on gasoline prices throughout this year. Gas prices may well not drop below $3 in any of the 50 states, or at least not for long.