Historic drop in gasoline prices ends

After falling for a record 123 consecutive days, the national average price for regular gasoline has reversed course, rising three cents over the last eight days, according to FuelGaugeReport.AAA.com .

"It certainly appears both oil and pump prices have bottomed out,” said Chuck Mai, spokesman for AAA Oklahoma. “Crude oil is rebounding, gasoline supplies are tightening up as refineries continue seasonal maintenance operations to gear-up for production the EPA-mandated cleaner-burning summer-grade fuels, and it hasn’t helped that workers at nine refineries in four states are on strike."

T he national average price for regular gasoline now stands at $2.07 per gallon, up three cents over last week but still 15 cents less than one month ago and $1.21 below the price one year ago, AAA reports.

"Prices usually rise between 30 and 50 cents in the spring because of higher demand and refinery down-time, and then they decline in the fall,” said Mai. “However, the supply of oil worldwide is still outpacing demand and unless something big happens to cause oil prices to increase substantially, we expect the Oklahoma gas price average to stay below $2.70 per gallon all year and the U.S. average to remain below $3.00."

Increasing pump prices are reflected across the country with 21 states now registering averages below $2.00 per gallon, down seven states from the 28 reported last week.

At $1.90 per gallon, Oklahoma is tied today with Louisiana for the seventh-lowest gas price average in the U.S. Idaho has the nation ’ s cheapest fuel ($1.86), followed by Utah and South Carolina (both at $1.88) and Missouri, Texas and New Mexico (all at $1.89).

Global oil prices are expected to remain relatively low during the first half of 2015, thanks to OPEC ’ s uncharacteristic decision not to support higher oil prices by cutting production. The ripple effects of sharply lower prices for crude are beginning to surface in both high-cost production countries as well as in producer nations that depend on oil revenue to balance budgets and provide social services to citizens.

Oil production companies around the globe as well as in Oklahoma are challenged with the decision of either cutting investments or continuing to supply the market at dramatically lower profit margins. Reports have been coming in recently of oil patch firms cutting back on production plans for 2015, which ultimately could put upward pressure on crude oil markets.

At the close of formal trading on the NYMEX Monday, WTI was up $1.33 to settle at $49.57 per barrel, the highest settlement since Jan. 5 of this year.