Decreased demands keeps gasoline prices plunging

Nevada experienced the fourth largest weekly decrease in the price of gasoline this week, according to a report from the American Automobile Association.

The dramatic decrease in economic activity because of the COVID-19 pandemic is crushing demand for gasoline. AAA said that the national gas price average decreased by a nickel this week, pushing the year-over-year savings to $1.03 gallon. Today, 20 states have pump price averages that are $1.00 or more per gallon cheaper than last year, with another dozen states within a dime of reaching that decrease, AAA said.

“One in four U.S. gas stations is selling gas for $1.49 or less,” said Jeanette Casselano, AAA spokesperson. “Even with regional refinery rates dropping, we will continue to see gas prices decrease though potentially at a slower rate than the past few weeks.”

Nevada’s decrease of 7 cents was equal to the decrease seen in Arizona, Minnesota, Washington and Kansas and trailed only Alaska (10 cents), Idaho (10 cents) and Wisconsin (8 cents). Wisconsin’s decrease was particularly noteworthy as the state is also the least expensive for gas at $1.22 per gallon on average.

California and Michigan reported 6-cent drops.

U.S. gasoline demand was stable last week as refinery rates dipped down to 69%, a level not reported by the Energy Information Administration in more than a decade. Despite lower run rates amid low demand, gasoline stocks increased. Total U.S. stock levels measure at a record 262 million barrels, the highest weekly domestic stock level ever recorded by EIA since it began reporting the data in 1990.

The West Coast region continues to see significant decreases despite carrying some of the most expensive averages in the country. Hawaii ($3.20) and California ($2.81) remain the most expensive markets in the country. Washington ($2.52), Oregon ($2.48), Nevada ($2.38), Arizona ($2.21) and Alaska ($2.11) follow.

According to EIA’s latest weekly report, total gas stocks in the region increased from 34.9 million barrels to 35 million barrels last week. The increase in supply, alongside low crude prices and gas demand, likely will help to push pump prices lower in the region this week.

Additionally, Marathon Petroleum announced that it would temporarily idle its 166,000 barrel-per-day refinery in Martinez, California, later this month because of weak demand caused by COVID-19. According to the company, as of April 27, it will use an “integrated network of assets to continue meeting customer commitments and (does) not anticipate supply disruptions in the region.”

Marathon did not announce a timeline for when the refinery could expect to resume operations, but it did state that it intends to resume “once demand levels support doing so.”

Motorists can find current gas prices along their route with the free AAA Mobile app for iPhone, iPad and Android. The app can also be used to map a route, find discounts, book a hotel and access AAA roadside assistance. Learn more at AAA.com/mobile.