Some US states have seen gasoline pump prices drop to their lowest level in over a decade as travel restrictions to stem the spread of the coronavirus pandemic continue to weigh on fuel demand .
“Six states are now at their lowest [price] since at least 2008, “said Patrick De Haan, responsible for petroleum analysis at GasBuddy. These are Wisconsin, Kentucky, Michigan, Oklahoma, Minnesota and Illinois. Prices in Wisconsin are at their lowest average since 2002, he said. Illinois, meanwhile, was at its lowest level since November 2008.
Low gasoline prices follow large losses for US oil prices, which have traded about 70% less to date. The International Energy Agency predicts that demand for oil will drop to a record low this year. Friday, May West Texas Intermediate gross
was $ 18.27 a barrel, the lowest since January 2002, according to FactSet data.
In the United States, the demand for gasoline is between 4.5 and 5 million barrels per day ”, [by] just over half of normal for this time of year, “De Haan told MarketWatch.
Approaching the market, on May 25, Memorial Day, which traditionally marks the start of the summer driving season, he called the demand “anemic.”
It is “in the shadow of his normal self,” he said, adding that he does not expect an immediate rebound.
“I think a demand ribbon can be destroyed forever,” with more companies perhaps adopting homework “for months and months,” said De Haan. Until the United States has recovered to 95% of the demand hit by the pandemic, the market will not even be close to its former self, he said.
Still, the gasoline market could seek to “get around a corner,” he said, adding that it does not expect demand to fall much more “unless something drastic happens.” developed”.
De Haan, California and Hawaii, which often have the highest prices in the country due to taxes and location, respectively, are expected to experience the largest price cuts. The rate of price reductions for these two states is “slow, mind-boggling, but this can represent uncertainty due to the loss of 50 to 70% of their volume”.
Prices for regular gasoline averaged $ 2.806 in California and $ 3.128 in Hawaii on Friday, according to data from GasBuddy.
“There is great potential that we will see gas prices this summer well below our previous expectations, and I hope that by then we can enjoy them safely,” said De Haan.