A recent AAA report shows that gasoline prices fell slightly due to lower oil prices, but the surge in the number of jobs added in January could lead to recession fears fading and rising price.
Last week, OPEC+ decided to maintain current production levels and make no cuts, leading to lower oil prices, according to AAA. Over the past week, the national average for a gallon of gas has barely budged, falling three cents to $3.47.
But Friday’s hit US report of 517,000 jobs added in January, bringing the unemployment rate down to a 54-year low of 3.4%, could have the opposite effect. Are recession fears fading and could a healthier global economy lead to increased demand for oil and higher prices?
“Keep an eye on the price of oil,” said AAA spokesman Andrew Gross, “because oil currently accounts for nearly 60% of what we pay at the pump. And rising or falling oil prices can have a direct impact on motorists’ wallets. »
According to data from the Energy Information Administration (EIA), gas demand fell from 8.14 million to 8.49 million bpd last week. Meanwhile, total domestic gasoline inventories increased by 2.6 million barrels to 234.6 million barrels. Despite the increase in gas demand, the growth in total supply has helped to limit the rise in prices at the pump.
The current national average of $3.47 is 18 cents higher than a month ago and four cents higher than a year ago.
Quick Stats
The 10 largest weekly declines in the country: Delaware (−15 cents), Ohio (−12 cents), Maryland (−9 cents), South Carolina (−9 cents), Tennessee (−9 cents), Alabama (−8 cents), Michigan (−8 cents), Indiana (−8 cents), Florida (−8 cents), and Virginia (−7 cents).
The 10 cheapest markets in the country: Texas ($3.08), Mississippi ($3.12), Oklahoma ($3.13), Missouri ($3.13), Kentucky ($3.14), Arkansas ($3.14), South Carolina ($3.17), Kansas ($3.18), Louisiana ($3.19), and Tennessee ($3.19).
Oil market dynamics
At the close of Friday’s official trading session, WTI was down $2.49 to settle at $73.39. Crude prices fell last week as the market feared that if a recession hits this year, demand and crude prices would likely decline. Additionally, crude prices fell after the EIA reported that total commercial inventories rose by 4.2 million barrels to 452.7 million barrels.
