If you have been to the pump recently, most of you know that fuel prices are finally starting to go down in some parts of the state. Which in turn, means oil prices have moderated over the past couple of weeks, allowing those fuel prices to flatten and even decrease in some states. But with the U.S. economy facing a potential slow down, what does this mean for fuel consumption?
Patrick DeHaan with GasBuddy talks about how concerns are growing with the state of the U.S. economy and that a potential slowdown could curb the fuel consumption.
?That, and an improvement in supply, gasoline inventories in the U.S. up for four out of the last five weeks, has contributed to the down drafts we?ve been experiencing, and barring any unexpected outages or hurricanes and such, we could continue to see prices moderating for the next couple of weeks.?
When thinking about how Ukraine and COVID impact oil prices, DeHaan says that those two issues are not the active drivers of prices one way or another.
?The Russian invasion of Ukraine is partially the reason why diesel prices has seen such a significant gap to gasoline, and that gap really isn?t changing. I expect diesel to moderate, but it will likely remain very high when compared to gasoline. On the other hand, COVID-19 has played more of an active role in that it has more limited refining capacity. U.S. refining capacity is down about one million barrels a day compared to where it was in 2019, and that has curbed the ability for refineries to get as much diesel as the market is looking for.?
DeHaan mentions he?s hopeful that U.S. consumers will continue to see oil prices moderate in the weeks ahead. He notes that a lot of volatility remains on the international scene.
