AAA: Growing Global Crude Supply Outpaces Demand, Driving December Pump Prices to Cheapest of the Year
BURNSVILLE, Minn. (December 7, 2018) – At $2.43 the national gas price average has set a new record low for 2018. This is nearly a nickel less than this time last December. AAA expects the national gas price average to fluctuate through the end of the month and possibly end the year as cheap as $2.40.
Globally, crude supply is growing faster than anticipated. Contributing to the surplus is the United States’ record-breaking production levels – which hit the highest level ever recorded by the Energy Information Administration at 11.7 million b/d last month. In addition, there is more Iranian supply in the market than expected due to the U.S. granting crude sanction waivers to some of Iran’s largest importers, including India, South Korea and Japan. To help reduce the growing surplus of global crude supply, this week the Organization of Petroleum Exporting Countries (OPEC) met to discuss the potential of cutting crude production by up to 1 million barrels per day. The announcement was expected yesterday, but the cartel delayed the decision until Friday to give time for non-OPEC countries, including Russia, to decide if they will join the production reduction agreement. Following the delay on Thursday, crude oil prices trended cheaper than earlier in the week because the announcement was not as firm as the market expected. AAA forecasts that as long as crude stays below the $60/bbl mark, Americans will continue to see cheaper gas prices through the end of the year.
“Consumers will have more change jingling in their pockets this holiday season as they save on fuel fill-ups, especially compared to this summer. The national gas price average has dropped more than 50-cents since Memorial Day weekend when the average spiked to a high of $2.97,” said Nick Jarmusz, director of public affairs for AAA – The Auto Club Group. “As prices continue to drop, some motorists are filling up for $2/gallon or less.”
Depending on what part of the country you are in, gas prices can fluctuate greatly. Some states – mostly the West Coast - are still seeing large year-over year differences, while others have cheaper gas prices than a year ago. In the Midwest, drivers are seeing the following statewide averages:
You can find more statewide averages, as well as metro region averages and historical comparisons at GasPrices.AAA.com.
- Iowa - $2.16
- Minnesota - $2.32
- Nebraska - $2.24
- North Dakota - $2.41
- Wisconsin - $2.29
AAA Members save at Shell through the Fuel Rewards®* Program
Announced this week, AAA members can now save up to five cents per gallon (on up to 20 gallons) through December 31, 2019, when filling up at participating Shell branded stations across the U.S. through the Fuel Rewards program. AAA members just need to register or log in at AAA.com/Shell to reap the benefits of this new program. As an added benefit, members registering for the first time in the Fuel Rewards program by January 31, 2019 will save 25 cents per gallon (on up to 20 gallons) on their first fill-up.
Winter Fuel & Driving Tips
As you hit the road this winter, AAA offers these tips to help conserve fuel and keep motorists safe:
- If possible, only run the engine and heater long enough to remove the chill. This will help to conserve fuel. Also, parking your car in a garage will help it stay warm.
- As a precaution, keep at least half a tank of fuel in your vehicle at all times. It helps to reduce condensation in the fuel system. It also helps ensure an adequate reserve of fuel to run the engine for heat should your car become disabled in a remote location.
- Be sure to pack an emergency roadside kit in your car containing a mobile phone and car charger, first-aid kit, blankets, drinking water and snacks, a flashlight with extra batteries, a basic toolkit, warning flares, an ice scraper, jumper cables and a shovel.
Motorists can find current gas prices at GasPrices.AAA.com and 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.
About AAA: AAA provides more than 59 million members with automotive, travel, insurance and financial services through its federation of 35 motor clubs and nearly 1,100 branch offices across North America. Since 1902, the not-for-profit, fully tax-paying AAA has been a leader and advocate for safe mobility. Drivers can request roadside assistance, identify nearby gas prices, locate discounts, book a hotel or map a route via the AAA Mobile app. To join, visit AAA.com.
* The Fuel Rewards® program is owned and operated by Excentus Corporation, a PDI company.