Significant Drop in USA Retail Gas Price Inflation
There has been a significant reduction in U.S. retail gasoline price inflation, Standard Chartered analysts stated in a new market note sent to Rigzone on Thursday.
In the note, the analysts outlined that the year on year change stands at 24.1 percent after peaking at 63.1 percent in mid-June. The month on month rate has also fallen sharply, according to the analysts, which highlighted that it stands at -14.2 percent compared to +14.1 percent in mid-June. They pointed out that this value peaked at +24.7 percent in mid-March.
“The average regular gasoline price has fallen for nine successive weeks,” the analysts stated in the report.
“The 15 August average of $3.938 per gallon is $1.068 per gallon lower than the June peak, USc 66.3 per gallon higher than end-2021 and just USc 40.8 per gallon higher than immediately before Russia invaded Ukraine,” the analysts added.
“The latest Energy Information Administration release shows the first signs of a demand response to lower prices; gasoline demand for August-to-date is higher year on year by 0.1 percent after a seven percent year on year fall in July,” the analysts continued.
The Standard Chartered analysts stated in the note that some caution is needed as demand is not yet strong enough to support substantially higher prices and is still 5.8 percent below August 2019.
“The year to date increase is also very limited at just 11,000 barrels per day, with year to date distillate demand gains at just 8,000 barrels per day,” the analysts said.
The analysts highlighted in the report that demand improvement after a weak July helped Standard Chartered’s U.S. oil data bull-bear index to a “highly bullish” +48.9, which was said to be the strongest reading in 10 weeks.
“Total inventories fell by 10.12 million barrels relative to the five-year average, reversing most of the previous week’s increase of 12.49 million barrels,” the analysts stated.
“Crude oil inventories fell 7.06 million barrels week on week to 424.95 million barrels, with the week on week balance changes dominated by the 2.89 million barrel per day rise in crude oil exports to an all-time high of five million barrels per day.
As of August 19, the average regular gasoline price in the U.S. was $3.918 per gallon, according to the AAA gas prices website. Yesterday’s average stood at $3.931 per gallon, the week ago average stood at $3.978 per gallon, the month ago average stood at $4.495 per gallon, and the year ago average stood at $3.177 per gallon, the AAA site showed.
The highest recorded average price for regular gasoline in the U.S. was seen on June 14, at $5.016 per gallon, according to the AAA site.
Last month, Standard Chartered analysts outlined that July U.S. gasoline demand readings were extremely poor. In a report sent to Rigzone on July 21, the analysts noted that the July to date average of U.S. gasoline demand was 8.29 million barrels per day – a figure they highlighted was even lower than the “pandemic-constrained” July 2020 average and 10.9 percent lower year on year.
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