Gasoline prices experienced another large weekly increase.
The average price of a gallon of regular unleaded in Michigan rose 19 cents to $4.36, according to the weekly release from AAA — The Auto Club Group. The 19-cent increase comes on the heels of a 23-cent weekly increase on Oct. 2 and a 13-cent jump recorded on Sept. 25.
Michigan’s average gas price of $4.36 on Sunday is 50 cents more than at this time in September and $1.03 more than the state average in October 2021.
The increase means Michigan motorists are paying an average of $65 for a 15-gallon tank of gasoline. This fill-up price is about about $14 more than 2021’s highest gas prices in November 2021.
Traverse City’s average of $4.31 was still among the least expensive in the state, just behind metro Detroit’s $4.29. Benton Harbor reported an average of $4.35.
The most expensive gas price averages in Michigan were reported in Lansing ($4.43), Saginaw ($4.43) and Flint ($4.43), according to the release from AAA.
“Rising crude oil prices, coupled with tightening supply due to refinery issues, continues to put upward pressure on pump prices,” AAA — The Auto Club spokesperson Adrienne Woodland said in the release. “If demand declines, it could possibly slow down the price increases that Michigan motorists have seen for the past few weeks.”
Gasoline demand increased nationally from 8.83 million to 9.47 million barrels per day, according to the latest data from the Energy Information Administration. At the same time, total domestic gasoline stocks decreased by 4.7 million to 207.5 million barrels, which the AAA release said was a significant decline.
“High gasoline demand, amid tight supply has led to higher pump prices nationwide,” the release from AAA said.
One of the areas of the United States to see gasoline prices soar is the West Coast. This increase was attributed to “ongoing refinery maintenance at roughly six refineries, severely limiting the region’s supply,” according to the release.
Refinery restarts and California officials allowing the sale of less expensive winter-blend gasoline a month ahead of schedule “should offer drivers relief at the pump in the coming days,” the release said.
A deadly refinery fire in Toledo, Ohio, also has tightened supply in the Midwest, according to the release. The “160,000 barrel-per-day BP-Husky Toledo refinery may be offline until December due to an ongoing investigation into the blaze,” according to the release.
West Texas Intermediate increased the price of crude oil by $1.24 to $87.76 at the close of Wednesday’s formal trading session, the release said.
The crude oil price increase came after the Petroleum Exporting Countries (OPEC) and its allies, known as OPEC+, announced intentions to cut crude production by 2 million barrels per day later this fall.
“The exact impact of the production cut on crude prices and domestic gas prices will depend on how the market interprets the reduction,” the release from AAA said. “If it appears that the production reduction is already occurring as a result of OPEC+ members being unable to meet current production quotas, the pricing impact is likely to be short-lived because the market may have already factored the lower production amount into pricing expectations.”
One of the reasons the stock market is unsure of how the production reduction will figure into gasoline prices the rest of the year is the stock market “has been concerned that a recession could lead to lower crude demand and prices,” according to the release.
The United States also typically sees a decline in gasoline demand in the fall, but especially in the winter.
The U.S. average price of gasoline rose 11 cents last week to $3.91. The average price of a gallon of regular unleaded last month was $3.74. A year ago the country’s average was $3.27.
Daily state and national gas price averages can be found at Gasprices.aaa.com or by downloading the free AAA mobile app.
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