Gas prices this weekend to see record diversity
The nationwide average price of gasoline some seven days ahead of the Memorial Day weekend is almost identical with prices in 2013 and 2013, but dramatic differences are observed when one examines detailed fuel prices in states and cities.
The nationwide average this weekend is likely to be between $3.60-$3.64 gal,. But statewide averages should range between $3.35 gal and $4.35 gal, reflecting the widest regional diversity in recent memory. What’s more, the diversity is bi-directional with some states kicking off the driving season with much lower prices, while other areas find stiff increases.
What’s behind this incredibly diverse U.S. fuel picture? Uneven refining operations. Last year saw nothing less than a major reconfiguration of large refineries in Great Lakes and Great Plains’ states. A much lighter schedule of maintenance has prevailed in 2014. On the other hand, Gulf Coast refinerieshave seen one of the most aggressive spring maintenance schedules in recent memory.
Huge differences in crude costs. Refiners in the Rocky Mountain and upper Midwestern regions could buy heavy Canadian crude for about $85 barrel recently. Robust new production coming from the Canadian oil sands has delivered some of the most advantaged crude in North America. In contrast, West Coast refiners are disadvantaged. Prices for Alaskan North Slope (ANS) crude currently fetch a price that is just shy of $110 barrel.
Diminished imports. Three years ago, U.S. ports typically handled 1-million barrels per day or more of imported gasoline from Canada, Europe, and the Caribbean and most of that fuel came in to East Coast cities. More recently, the U.S. has turned into a net exporter, regularly sending more gasoline offshore than it brings in from foreign destinations.