US Gasoline Prices Drop Ahead of Labor Day Weekend, Says EIA.
As the Labor Day weekend approaches, marking the end of the U.S. summer driving season, gasoline prices across the United States are notably lower than they were a year ago, according to a report from the U.S. Energy Information Administration (EIA) released on Thursday.
The average price for regular gasoline nationwide stood at $3.31 per gallon as of August 26, reflecting a 13% decrease compared to the same time last year. Despite the lower prices, the EIA reported an increase in gasoline demand leading into the holiday weekend. Data from the week ending August 23 showed U.S. gasoline demand at 9.3 million barrels per day, the highest level for August since 2022.
The EIA anticipates that after the summer driving season concludes, gasoline demand will weaken compared to last year, which could help maintain lower prices in the coming months.
Several factors have contributed to the lower prices at the pump. These include modest growth in global and U.S. petroleum product demand, continued crude oil production increases from non-OPEC+ countries, and economic slowdowns in China. The EIA noted that regional gasoline prices in the U.S. Midwest spiked more than 20% above the national average from July 22 to August 5 due to a series of refinery outages.
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Currently, U.S. gasoline inventories are at 221 million barrels, approximately 3% higher than at the same time last year. Additionally, Brent crude oil prices as of August 26 were down 4% from a year earlier. The EIA estimated that crude oil prices contributed 55% to the cost of gasoline as of June 2024.
This combination of factors suggests that motorists may continue to enjoy lower prices at the pump in the months following Labor Day.
