Motorists Seeing Slight Relief At The Gas Pump

With fall approaching and the height of summer in our rearview, motorists in the Carolinas are starting to see slight relief at the pump as gas price averages dropped lower by a penny on the week.
“Even though supply has tightened after slow recovery from Hurricane Ida, we’ve also reached the point when gasoline demand starts its seasonal decline,” said Tiffany Wright, spokesperson, AAA – The Auto Club Group in the Carolinas. “There may still be some price fluctuation here and there, but we should expect to start seeing stability at the pump.”
North Carolina’s current gas price average is $2.95, seeing a 1-cent decline on the week. This is 3 cents more expensive than a month ago and 91 cents more expensive than last year. South Carolina’s current gas price average is $2.89, seeing no changes on the week. This is 2 cents more expensive than a month ago and 96 cents more expensive than last year. South Carolina is also a part of the nation’s top 10 least expensive markets.
The national gas price average of $3.17 is a penny less than a month ago but is 98 cents more than a year ago.
The recovery from Hurricane Ida remains slow, with the latest U.S. data showing just under half of the U.S. offshore oil production in the Gulf still idle after companies shuttered production ahead of the storm. Meanwhile, refinery utilization is down almost 10%, causing gasoline stock levels to fall, according to the Energy Information Administration (EIA). Stock levels are likely to remain tight until Ida-affected refineries resume normal operations. While refineries are reporting progress towards restarting, the U.S. Department of Energy (DOE) said it would release an additional crude oil held at the U.S. Strategic Petroleum Reserve (SPR) to help ease tightened supplies brought by Hurricane Ida. This is the second such release, and the DOE said the SPR has now released a total of 3.3 million bbl of crude oil in response to the storm.
The constraint on stocks would typically lead to higher prices, but it has been offset by decreased demand going into the fall. In the week ahead, pump prices may be impacted by Tropical Storm Nicholas, which is expected to bring heavy rains and a storm surge to the Texas coast this week. If the tropical storm puts additional refineries offline, we are likely to see prices increase.
Crude prices remain elevated as approximately 48% of crude oil production in the Gulf Coast region is shuttered due to Hurricane Ida, according to the federal Bureau of Safety and Environmental Enforcement. As production gradually returns to normal operations, crude prices should stabilize as supply increases.
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