SAN DIEGO (June 1, 2022) – The average price of a gallon of self-serve regular gasoline in San Diego County rose Wednesday to a record for the fifth consecutive day, increasing 3.3 cents to $6.114, its sixth consecutive increase.
The average price has risen 9.6 cents over the past six days, including six-tenths of a cent Tuesday, according to figures from the AAA and the Oil Price Information Service. It is 9.4 cents higher than one week ago, 33.4 cents more than one month ago and $1.926 greater than one year ago.
The price of a barrel of front month crude on ICE Futures Europe dropped $2 Tuesday to settle at $115.60, one day after increasing $2.04 to settle at $117.60, its highest amount since March 23.
Analysts attributed Monday’s increase to anticipated increased demand following the weekend comments by Shanghai Vice Mayor Wu Qing that coronavirus- related restrictions would be reduced this week and the expectation of a reduction in supply stemming from the pledge by European Union leaders to impose an oil embargo on Russia.
Crude oil costs account for slightly more than half of the pump price, according to the U.S. Energy Information Administration.
The rest of the price includes the other components of gasoline, production costs, distribution costs, overhead costs for all involved in production, distribution and sales, taxes and carbon offset fees in California paid by the refineries.
Crude oil has moved above $115 a barrel due to fears of further global supply constraints caused by a European Union (EU) ban on Russian oil exports. And domestic gas demand may again start to climb as drivers fuel up for the three-month-long summer travel season, which began this Memorial Day weekend. AAA forecast nearly 35 million travelers hit the road for Memorial Day. It’s the highest number since 2019, despite record prices at the gas pump.
“So far, the pent-up urge to travel caused by the pandemic outweighs high pump prices for many consumers,” said Andrew Gross, AAA spokesperson. “But 67% of drivers recently surveyed told us they would change their driving habits if gas hit $4.50 a gallon. That number rises to 75% at $5 a gallon. If pump prices keep rising, will people alter their summer travel plans? That remains to be seen.”
According to Energy Information Administration (EIA) data, total domestic gasoline stocks decreased by 500,000 bbl to 219.7 million bbl last week. Gasoline demand also dipped from 9 million b/d to 8.8 million b/d, approximately 700,000 b/d lower than a year ago. The softening of gas demand helped minimize price increases ahead of Memorial Day. However, gas demand may spike this week after drivers took to the roads for the holiday. But pump price increases could be limited if demand slows again following the holiday weekend.
Today’s national average for a gallon of gas is $4.62, which is 45 cents more than a month ago, and $1.58 more than a year ago.
Source: KUSI and AAA contributed to the article.