U.S. Gasoline And Crude Oil Prices Slide Before The Holidays

U.S. gasoline prices have fallen for the sixth week in a row, falling 2.9 cents from a week ago, according to a Gas Buddy report published Monday.

A gallon of gasoline fell to $3.30 per gallon on Monday, Gas Buddy’s survey of more than 11 million gas stations showed.

Gasoline prices are still up 50% from a year ago, but are down 22 .1 cents per gallon from a month ago.

“For yet another week, average gasoline prices continue to fall as omicron cases surge, leading oil demand, and thus oil prices, to stall. The decline in gas prices will likely continue until new Covid cases slow down,” Patrick De Haan, head of petroleum analysis for Gas Buddy, said.

But gasoline demand isn’t stalling. U.S. retail gasoline demand rose last week ending December 18, up 2.9% from the week prior.

“Beyond Christmas,” De Haan added, “with omicron cases likely to continue climbing, I do believe we’ll see a more noticeable hit on gasoline demand once the holidays are over. There’s a rising likelihood that we won’t see gas prices rising for the rest of the year- with one caveat- gas prices in the Great Lakes states have plummeted by 30 to 50 cents in some areas, and stations in those areas may raise prices slightly should oil prices slow their decline. Aside from those areas, declines at the pump are likely to continue as we close out 2021.”

But oil price declines are not slowing. The price of crude oil fell spectacularly on Monday, with WTI slipping by nearly 6%, while Brent crude slipped by nearly 5%. At 11:00 a.m., EST, WTI was trading at $66.69 per gallon, down $4.17 (-5.88%) on the day. Brent crude was trading at $69.96, down $3.52 (-4.79%) on the day.

Pressuring crude oil prices is the specter of the global effects to limit the spread of the latest Covid variant, Omicron. Already several European states have issued fresh lockdowns in response to Omicron, sparking worry that this may strip away some of the oil demand that has been regained in the last few months.

By Julianne Geiger for Oilprice.com

More Top Reads From Oilprice.com:

• Cities Around The World Are Trying To Cut Out Natural Gas
  
• Tight U.S. Oil Inventories Prop Up Oil Prices
  
• Are Oil Markets Already Oversupplied?