Statewide Gas Price 99 Cents Cheaper Than a Year Ago
CLOVIS (KSMX)- The statewide gas price average in New Mexico is $1.77 for a gallon of regular unleaded fuel, according to the AAA New Mexico Weekend Gas Watch. That price is three cents less than on this day last week and 99 cents less per gallon than on this day last year. The national average price for a gallon of regular unleaded is $1.79, which is four cents less compared to this day last week and $1.06 less than the price per gallon at this same time last year.
The statewide pump price average continues to sit at the cheapest level since January 2016. This downward trend should continue as crude oil trades at record low prices, even hitting unprecedented negative figures earlier this week. However, AAA doesn’t expect gas prices to fall into negative territory as many factors go into the price of a gallon of gas, including transportation, marketing as well as retailers set individual prices at gas stations.
“It is no surprise that gas prices are falling around the Land of Enchantment due to the demand destruction caused by COVID-19,” said AAA New Mexico spokesperson Daniel Armbruster. “Oil prices traded in the negative for the first time ever earlier this week, but gas prices are not forecast to go negative as there are several components which go into a gallon of gasoline.”
Regional refinery utilization dropped to just under 74% in the last week, according to the U.S. Energy Information Administration (EIA).
At the national level, refinery utilization sits at 68%. U.S. Gasoline demand rose slightly to 5.3 million barrels per day last week. That’s up from the nearly 5.1 million barrels per day the week prior but still far-off from the nearly 9 million barrels per day just a month ago. To offset decimated demand levels, U.S. refiners are reducing production.
Three refineries have even closed: Come-by-Chance, Canada; Gallup, New Mexico; and Marathon Petroleum’s Martinez, California refinery. While the reductions and closures will help, they will not balance the glut of U.S. gasoline stocks against record-low demand rates.