CAMARILLO, Calif. -- The March 8 national average retail price is down 5.56 cents per gallon on regular-grade gasoline, to $3.7394, according to the most recent Lundberg Survey of approximately 2,500 U.S. gas stations. This after a nine-week surge of nearly 54 cents per gallon. And the current price sits 7.54 cents per gallon under the year-ago price, another favorable input to the motorist experience.
Lower crude oil prices, coming from a stronger U.S. dollar and growing access by U.S. refiners to lower-priced domestic crude among other factors, had already been translating to reduced wholesale gasoline prices two weeks ago. Now retailers have been able to cut price by nearly six cents on average. And there's probably more to come.
Since Feb. 22, refiners continued cutting prices to their marketers, jobbers and retailers. So another 10-to-13-cent decline at the pump on average is likely in the near future, unless oil prices leap.
Refiner and retailer margins on gasoline are both in healthy territory, with refiners losing a little and retailers gaining further in the past two weeks. This is supporting a continuation of retail price cuts.
Gasoline supply is plentiful, and will probably continue to be as pre-spring refinery repair projects are being completed.
Crude oil accounts for about 70% of the retail gasoline price. The U.S. oil production boom, with Bakken and other nontraditional resources racing into the refining slate, is therefore a contributor to falling retail gasoline prices.
Gasoline demand, already brightening, got a boost from Daylight Saving Time on March 10 as we head toward the season of highest consumption.
With downstream gasoline margins doing better and retail price cuts helping consumers, this seems to be a win period for all.
Camarillo, Calif.-based Lundberg Survey Inc. is an independent market research company specializing in the U.S. petroleum marketing and related industries.