AAA: Gas prices in Carolinas continue to fall after crude oil plunges

North Carolina

CHARLOTTE, N.C.  – Gas prices in the Carolinas continue to trend cheaper as fears of a possible COVID-19 economic slowdown caused crude oil prices to plunge into the mid $60s per barrel, a price not seen since August.

“Motorists are catching a break right now at the pumps with lowered gas prices,” said Tiffany Wright, spokesperson, AAA – The Auto Club Group in the Carolinas. “But an economic slowdown could very well prompt OPEC to cut production if crude oil prices drop too low.”

Last week, OPEC and its allies announced it would stick to its plan, for now, to raise production by 400,000 b/d in January. The move was likely in response to the Biden Administration’s call to increase supply to curb high fuel prices.

Currently, North Carolina’s gas price average sits at $3.15, having a 4-cent decline on the week. This is 9 cents cheaper than a month ago and $1.16 more expensive than last year. South Carolina’s gas price average sits at $3.04, having a 5-cent decline on the week. This is 12 cents cheaper than a month ago and $1.13 more expensive than last year.

Today’s national average of $3.35 is seven cents less than a month ago and $1.19 more than a year ago.

According to new data from the Energy Information Administration (EIA), total domestic gasoline stocks increased by more than 4 million bbl last week. Meanwhile, gasoline demand dipped from 9.3 million b/d to 8.8 million b/d. The slight decrease in demand contributed to falling prices, while lower crude prices also put downward market pressure on pump prices.

Crude oil prices decreased last week due to uncertainty of the COVID-19 Omicron variant’s impact on demand and the announcement that OPEC will ramp up production by 400,000 b/d in January. Additionally, EIA reported minimal draws on U.S. commercial crude oil inventories, which decreased by 900,000 bbl from the previous week to 433.1 million barrels. This week, crude oil prices could continue to fluctuate. Market watchers will keep a close eye on crude oil inventories and the impact that the omicron variant has on demand.

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