Record domestic crude oil production and low gas demand trigger New Year savings
BOISE – (January 7, 2019) – It was a rollercoaster ride for gas prices in 2018, with prices tumbling, both nationwide and in Idaho, for the last quarter of the year. There’s more good news – the trend of seasonal savings continues into January, thanks to an abundance of global crude oil and the lowest fuel demand in nearly two years.
“The price for a barrel of crude oil topped $76 in early October, but today, it’s trading closer to $50,” says AAA Idaho spokesman Matthew Conde. “Prices are low because the market continues to believe that there is a glut of crude oil out there, more than enough to meet the reduced fuel demand, which is at its lowest point since February 2017.”
Today, the U.S. average gas price is $2.24, which is 20 cents less than a month ago, and 26 cents less than a year ago. Although gas prices remain higher in Idaho, there’s still cause for celebration – today’s price is $2.53, which is 22 cents less than a month ago, and two cents less than a year ago. After several months, the Gem State is also out of the top ten for most expensive gas prices, coming in at #13 today.
After a quiet winter, gas prices surged to kick off the 2018 travel season, before plateauing for most of the spring and summer. Around October 1, gas prices took a nose dive, bringing some much-needed relief at the pump for holiday travelers, even with record numbers hitting the roads.
But that could change soon. OPEC’s production cuts went into effect January 1, with plans to reduce crude oil production by 1.2 million barrels per day for at least the first six months of the year in an attempt to stabilize the global crude supply. If the organization’s plans are successful, the existing supply will tighten, putting upward pressure on crude oil prices, and, in turn, gas prices.
“Crude oil makes up about half of the cost of gasoline, and if OPEC’s production cuts don’t push gas prices higher, increased fuel demand in the spring likely will,” Conde said. “Short term, however, pump prices are still pretty friendly to drivers’ wallets.”
Domestic crude production held steady at a record 11.7 million barrels per day for the second week in a row, and although the U.S. lost eight oil rigs last week, the current total is 877 – still 135 more than this time last year.
Today, twelve states have an average gas price below $2 per gallon. 36 states have an average price below $2.50 per gallon. The most expensive fuel can be found in the West, with California at $3.32 per gallon, and Hawaii and Washington rounding out the top three.
In 2018, Idaho gas prices topped out at $3.26 on August 27. The cheapest price for the year was $2.53 on January 1.
Here’s a look at current gas prices across the Gem State: Aberdeen, $2.55; Albion, $2.71; American Falls, $2.50; Arco, $2.65; Bellevue, $2.62; Blackfoot, $2.49; Boise, $2.44; Bonners Ferry, $2.55; Burley, $2.68; Cascade, $2.70; Challis, $2.83; Coeur d’Alene, $2.36; Cottonwood, $2.65; Council, $2.70; Dalton Gardens, $2.35; Declo, $2.75; Donnelly, $2.70; Eagle, $2.40; Emmett, $2.40; Filer, $2.43; Franklin, $2.53; Fruitland, $2.49; Glenns Ferry, $2.49; Greenleaf, $2.47; Hagerman, $2.70; Hailey, $2.64; Hayden Lake, $2.33; Homedale, $2.47; Horseshoe Bend, $2.50; Idaho Falls, $2.58; Island Park, $3.10; Jerome, $2.53; Kamiah, $2.27; Kellogg, $2.58; Ketchum, $3.30; Lewiston, $2.64; McCall, $2.68; Moscow, $2.79; Mountain Home, $2.51; New Plymouth, $2.46; Notus, $2.47; Orofino, $2.36; Parker, $2.61; Pinehurst, $2.58; Pocatello, $2.59; Post Falls, $2.34; Rexburg, $2.62; Salmon, $2.80; Sandpoint, $2.69; Soda Springs, $2.58; Stanley, $3.06; Teton, $2.60; Twin Falls, $2.53; Wallace, $2.58; Wendell, $2.49.