LEXINGTON, Ky. — The laws of supply and demand continue to be the story behind fluctuating gas prices across the country, including Kentucky.
Gasoline demand measured 8.9 million barrels per day in the Energy Administration’s (EIA) latest weekly report, up nearly 4% from the week prior. Because of the jump in demand, gasoline supplies tightened to 230.5 million barrels, the lowest level this year.
As a result, state gas price averages saw prices fluctuate. On the week, states saw pump price changes ranging from an increase of 15 cents to a decrease of 3 cents. In Kentucky, the average price is 4 cents higher than a week ago, landing at $2.72.
Today’s national average is $2.87, which is more expensive on the week (+1 cent), month (+12 cents) and year (+94 cents).
“We anticipate demand will continue to increase throughout the month as vaccinations become more widely available and weather turns warmer,” said Lori Weaver Hawkins, public and government affairs manager, AAA Blue Grass. “This will lead to fluctuation at the pump throughout the spring season.”
Here’s what is happening with crude
One factor that may help to keep the national gas price average below $3/gallon is the price of crude, which accounts for nearly 60% of the price at the pump.After hitting a 12-month high of $66/barrel last month, crude has been priced mostly at the $60 per barrel mark recently.
If it stays low, even with demand increasing, it will contribute to less frequent pump price jumps. However, at the end of last week, crude started to see higher movement following a production announcement by Organization of the Petroleum Exporting Countries Plus (OPEC+).
Gas prices see minor ups and downs across the Bluegrass
Today’s average of $2.72 in Kentucky is 4 cents higher than last week and 17 cents more than a month ago. Today’s average price in Kentucky is now $1.12 higher than the commonwealth’s average of $1.60 seen a year ago.
Most of the Bluegrass saw minor fluctuations this week, most upward, but some trending downward.
In Lexington, the average price is mostly steady, down just a penny from last week to land at $2.73. That’s 20 cents higher than a month ago.
Surrounding communities saw gas prices creep up two or three pennies, though there were exceptions. In Nicholasville, the average price is up 2 cents, now at $2.69. Georgetown is up 5 cents, now averaging $2.72. Versailles is down 2 cents to land at $2.72, while Winchester is up 4 cents to land at $2.74. Richmond is down 3 cents, landing at $2.75.
Ashland was the low spot in Kentucky this week, averaging $2.59.
- The nation’s top 10 largest weekly changes: Ohio (+15 cents), Michigan (+11 cents), Indiana (+11 cents), Wisconsin (+7 cents), Kentucky (+4 cents), Illinois (+4 cents), Hawaii (+4 cents), Florida (−3 cents), Idaho (+3 cents) and Tennessee (+3 cents).
- The nation’s top 10 least expensive state averages: Mississippi ($2.58), South Carolina ($2.58), Texas ($2.59), Louisiana ($2.62), North Carolina ($2.62), Oklahoma ($2.62), Missouri ($2.64), Alabama ($2.64), Kansas ($2.66) and Arkansas ($2.67).
Price likely to fluctuate this week, but not spike
The benchmark West Texas Intermediate price increased $2.29 to settle at $61.45. Crude oil prices saw gains at the end of the week following the OPEC+ announcement that they will modestly increase production by 350,000 bbl starting in May. The production increase is less than the market expected, but enough to send crude oil prices higher. This week prices are likely to fluctuate, but not spike.
The AAA Daily Fuel Gauge Report is the most comprehensive U.S. gas price survey available from any source. More than 100,000 self-serve stations are surveyed daily in compiling the not-for-profit’s report, compared to other price-reporting sources that rely on customer input or surveys from only a limited number of stations.