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Thursday, May 23, 2024

AAA Tidewater: Gas Demand Declines as Recession Fears Weigh Down Oil Market Expectations

Gasoline prices in Hampton Roads are lower than the national average, but more expensive than 2017. (WYDaily/Courtesy Adobe)
(WYDaily/Courtesy Adobe)

VIRGINIA BEACH — Fears of a global economic recession led to a major drop in the price of crude which helped to minimize pump price increases last week, according to AAA Tidewater, while domestic gasoline demand decreased as fewer drivers fueled up.

According to the Energy Information Administration (EIA), gas demand decreased nationally from 9.47 to 8.28 million barrels per day, while domestic gasoline stocks increased by 2 million barrels to 209.5 million.

“Lower gasoline demand, amid increasing supply and fluctuating oil prices, has contributed to the national average moving downward,” said Ryan Adcock, AAA Tidewater public relations specialist. “If demand continues to drop coupled with a slide in oil prices, drivers could see increases in prices at the pump start to slow and even come down through the week.”

The national average pump price for a gallon of gas dropped three cents over the past week. Monday’s national average of $3.88 is 20 cents higher than a month ago and 56 cents more than a year ago.

(AAA Tidewater)

Local Stats

Prices across the commonwealth increased to $3.57, eight cents higher than a week ago and 16 cents higher than a month ago. In Hampton Roads, prices increased ten cents to $3.56, 23 cents higher than last month and 38 cents higher than a year ago.

Oil Market Dynamics

Crude prices decreased last week in response to global economic fears, and that trend could continue as interest rates rise globally, which could lead to a recession, AAA said, adding if a recession occurs, crude prices would likely reduce alongside demand.

EIA’s latest weekly report showed that total commercial crude inventories increased by 9.9 million barrels to 439.1 million.

Drivers can find current gas prices along their route using the AAA TripTik Travel planner.        

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