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Economy in Brief

U.S. Gasoline Prices Near Seven-Year Low
by Tom Moeller  January 5, 2016

For all of 2015, the pump price for a gallon of regular gasoline averaged $2.03 according to the U.S. Department of Energy, the lowest level since 2008. Prices have fallen 45% since late-April of 2004. As of last week, pump prices held at $2.03 per gallon (-8.4% y/y), where they've been since late-November. Haver Analytics constructs factors adjusting for the seasonal variation in pump prices. The seasonally adjusted price fell one penny last week to $2.26 per gallon. Declines in spot market gasoline prices outpaced the decline in pump prices, falling 16.2% y/y to $1.27 per gallon as of last week.

During 2015, WTI crude oil costs also fell sharply. Prices averaged $48.90 last year, off 47.8% y/y and were $36.97 per barrel last week (-30.8% y/y). Yesterday's price of $36.76 was up slightly from the $34.55 low reached two weeks ago. Prices were down from the daily high of $113.93 in April 2011. Brent crude oil prices held w/w at $37.06 per barrel (-33.6% y/y) and were $37.33 yesterday.

Natural gas prices also were under pressure in 2015, falling 40.0% to average $2.62 per mmbtu. Increased shale-gas production weighed heavily on prices. Yesterday, prices rallied to $2.21 from their December low of $1.85, but still were down roughly one-quarter y/y.

Falling gasoline inventories provided some support for prices last year with a 3.3% decline, continuing to drop through last week. Inventories of all petroleum products, however, rose 9.3% for the full year. Crude oil production (input to refineries) increased 1.2% y/y during the last four weeks. Gasoline demand improved 0.4% y/y last week but demand for all petroleum products eased 0.2% y/y.

The energy price data are reported by the U.S. Department of Energy. The petroleum demand and inventory figures are from the Oil & Gas Journal Weekly. These data can be found in Haver's WEEKLY database. The daily figures are in DAILY and greater detail on prices, demand and production, along with regional breakdowns, are in OILWKLY.

Weekly Energy Prices 01/04/16 12/28/15 12/21/15 Y/Y% 2015 2014 2013
Retail Gasoline ($ per Gallon, Regular) 2.03 2.03 2.03 -8.4 2.03 2.30 3.33
Light Sweet Crude Oil, WTI ($ per bbl., WSJ) 36.97 36.26 35.78 -30.8 48.90 93.64 97.96
Natural Gas ($/mmbtu, LA, WSJ) 2.21 1.63 1.69 -26.8 2.62 4.37 3.73
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