WEX released its latest WEX Index fuel prices report, which detailed the reasons why prices are falling in most parts of the U.S. WEX stated the national retail price for a gallon of gasoline started the month at $3.55 per gallon, which is down close to 10 cents per gallon from where the price started in April. This price is down nearly 30 cents per gallon from last year.
According to WEX, refinery issues in the upper Midwest have caused regional supply issues. Prices in most states are down as much as 45 cents per gallon, but Michigan, Indiana, and Ohio are showing prices about 5 cents above where they were a year ago. The company added that in the rest of the U.S., analysts are predicting prices will fall somewhat. Regional oil markets, such as the New York Harbor and Gulf Coast, are seeing gasoline prices 70 cents per gallon less than in the Chicago area.
Low demand and increased supply are major factors contributing to falling prices. According to WEX, traders have been disappointed with gasoline demand figures. Gasoline demand was measured at 8.415 million barrels per day, and four-week average demand is now 156,000 barrels per day less than during the same period last year. In terms of supply, U.S. crude oil stocks moved higher than 395 million barrels. The company added that inventories have never been higher since the U.S. Energy Information Administration started tracking the data.
Diesel fuel demand is also facing low domestic demand and will largely depend on the need for cargo from the U.S. from countries in the southern hemisphere.