Omicron Variant COVID-19 fears push oil prices down
Washington DC. – Prices at the pump continue to fall as fears of a possible global economic slowdown from the COVID-19 coronavirus have pushed oil prices to the middle of $ 60.00 per barrel, a price not seen since August.
The decision by OPEC and its oil-producing allies not to cut production has also helped ease the upward pressure on prices. The national average for a gallon of gasoline fell 4 cents per week to $ 3.35. For consumers, gasoline prices were at their lowest on October 20.
“Consumers can take a break from the pumps right now, but it’s not for a very good reason,” said Andrew Gross, spokesperson for AAA. “A potential economic downturn induced by COVID-19 hurts everyone and could prompt OPEC to cut production if oil prices fall too low.”
On December 2, OPEC and its allies, a group called OPEC +, announced that they would stick to their plan, for now, to increase production by 400,000 bpd in January. The move was likely in response to the Biden administration’s call to increase supply to bring high fuel prices under control.
According to new data from the Energy Information Administration (EIA), total national gasoline inventories increased by more than 4 million barrels to reach 215,422 million barrels last week. Meanwhile, demand for gasoline has increased from 9.3 million b / d to 8.8 million b / d. The slight drop in demand contributed to the fall in prices, while the fall in crude prices also put downward pressure on prices at the pump.
The current national average of $ 3.35 is seven cents less than a month ago and $ 1.19 more than a year ago.
The top of the nation The 10 biggest monthly drops: Indiana (? 21 cents), Michigan (? 18 cents), Ohio (? 17 cents), Washington, DC (? 15 cents), Missouri (? 14 cents), Texas (? 13 cents), Iowa (? 13 cents) ), Kansas (? 12 cents), Oklahoma (? 12 cents) and South Carolina (? 12 cents).
The Nations top 10 most expensive markets: California ($ 4.68), Hawaii ($ 4.34), Nevada ($ 3.91), Washington ($ 3.87), Oregon ($ 3.78), Arizona ($ 3.77), Alaska ($ 3.71), Idaho ($ 3.65), Utah ($ 3.62), and Pennsylvania ($ 3.57).
Dynamics of the oil market
At the close of official trading last week, WTI fell 24 cents to $ 66.26. Crude oil prices fell last week amid uncertainty over the impact of the COVID-19 omicron variant on demand and the announcement that OPEC + will increase production by 400,000 bpd in January .
In addition, the EIA reported minimal drawdowns on US commercial crude oil inventories, which fell 900,000 barrels from the previous week to 433.1 million barrels. This week, crude oil prices may continue to fluctuate. Market watchers will closely monitor crude oil inventories and the impact of the omicron variant on demand.
Motorists can find current gas prices along their route with the free AAA Mobile app for iPhone, iPad and Android. The app can also be used to plot a route, find discounts, book a hotel, and access AAA roadside assistance. Learn more about AAA.com/mobile.
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