TAMPA — The most expensive oil of 2015 triggered increases at the gas pump, and prices could continue to climb this week. The national average price of regular unleaded gasoline is $2.45 per gallon, up 6 cents since last Sunday. Prices also rose 3 cents in Florida and 9 cents in both Georgia and Tennessee.
“The average price at the pump typically reflects a bit of seasonality this time of year,” said Mark Jenkins, spokesman, AAA – The Auto Club Group. “It is not uncommon for prices to inch higher leading up to the summer driving season and the transition to more expensive summer-blend fuel. However, record high domestic oil production is likely to deliver the cheapest summer gas prices in a decade.”
A primary factor driving prices this week was more expensive oil prices keyed by a combination of increased geopolitical tensions in the Middle East, a sharply lower U.S. dollar, and the release of OPEC’s monthly market report. News of Al Qaeda militants taking control of a major oil terminal in Yemen stoked some fears that violence could spread in the region. A weaker U.S. dollar makes West Texas Intermediate crude oil (priced in U.S. dollars) a more attractive investment, which pressures prices higher. Also last week, oil prices moved after OPEC’s monthly market report unveiled expectations of a slight increase in demand for the oil it produces. These factors led to WTI recording its highest settlement for 2015 ($56.71) on Thursday. Oil slipped the following day, closing almost a dollar lower ($55.74 per barrel) on the NYMEX, Friday.
“It could take a full week before the full impact of higher oil prices hit the gas pump, and gas prices could rise 5-10 cents as a result,” Jenkins said. “The good news is that oil began to fall again by the end of last week. Looking long term, gas prices could still fall in time for the busy summer travel season.”