Utah gasoline prices now among highest in the country
Utah motorists will be paying about 15 cents more for each gallon of gasoline this Fourth of July compared with last year.
The average price of unleaded regular gasoline in Utah is now $3.73 a gallon, up from $3.58 last year, according to Rolayne Fairclough, spokeswoman for AAA Utah.
"This is the time of year when the cost of gasoline in Utah is typically among the top-tier states," she said. "And this year doesn't seem to be any different than in the past."
Nationally, the average cost of unleaded regular was $3.48 Wednesday afternoon, or 26 cents less than in Utah, which at $3.73 was the eight highest price in the country.
Fairclough noted, though, that the nationwide average price for a gallon of regular gasoline has fallen for 20 consecutive dates because refineries are producing fuel at high levels.
"Our prices have declined 3 cents a gallon from last week, so hopefully that is a signal that we can look forward to the same downward trend that is happening elsewhere," she said.
Even though gasoline prices have fallen nationally to a five-month low in advance of the busy July 4 travel weekend, pump prices on Independence Day still will be the third-highest recorded on the holiday, according to the national AAA organization.
The recent decline notwithstanding, July 4 holiday pump prices were only higher in the record-setting year 2008 and in 2011.
Gasoline stockpiles are up 10 percent from a year ago and the nation's gasoline inventory of more than 225 million barrels is the highest since 1992, according to the U.S. Energy Information Administration.
Refiners reported the largest fuel supply for late June in decades, said Andrew Lipow, president of Houston-based consulting firm Lipow Oil Associates.
"Gasoline prices are probably going to fall another 2 to 3 cents a gallon (this week) and then maybe another total of 5 to 7 cents over the next couple of weeks, but the outlook is for pretty stable gasoline supplies," Lipow said.
The big supply of gasoline has to do with increasing demand for diesel, said Bill Day, spokesman for San Antonio-based Valero, the nation's largest independent refiner.
When refineries process a barrel of oil, it yields both gasoline and diesel.
And since diesel is bringing high profit margins, refiners are trying to crank out as much of it as they can, Day said.
"There is more demand for diesel and demand for diesel is growing faster than it is for gasoline, both in the U.S. and worldwide," he said.
Tom Kloza, chief oil analyst for GasBuddy, a consumer-oriented fuel price information service, said gasoline demand this year is about 2.5 million gallons a day less than in 2012 and about 25 million gallons a day less than in 2008, when prices hit their highest levels ever.
GasBuddy was acquired earlier this year by Oil Price Information Service, which supplies the gasoline price surveys used in AAA's reports.
Kloza said gasoline demand continues to fall because of improving vehicle efficiency and changes in demographics and driving habits: The population of older people, who typically reduce their driving, is growing, and younger people are driving less than in previous generations.
"It's a very subtle change," Kloza said. "It's not as if kids are counting down the days to get driver's licenses like they used to."
Kloza attributed some of the changing habits to increased use of technology, like social media and online communication, which may decrease interest in travel for face-to-face interaction.
Though analysts expect average national gasoline prices to continue a modest decline, high world oil prices probably will keep prices from falling significantly, AAA said.
The price of crude is the major determinant of gasoline prices, and U.S. benchmark crude consistently has been more than $90 a barrel this year.
"Gas prices remain high and may not drop too much further in July because crude oil remains relatively expensive," AAA spokesman Avery Ash said in a statement. "Factors such as increased summertime demand and the impending hurricane season also could result in higher pump prices for motorists."
AAA Utah estimates that 2.5 million residents of the eight Mountain West states will hit the roads to travel more than 50 miles from home in automobiles during the holiday period beginning Wednesday and ending July 7. That's down slightly from 2.6 million over last year's Independence Day holiday.
Kloza said gasoline prices will fall more in mid-September, as refineries change from pricier summer blends designed for higher temperature operation.
New York Times News Service contributed to this story.
Gas prices in Utah
Wednesday • $3.73
Week ago • $3.76
Month ago • $3.71
Year ago • $3.58
Record high • $4.22 (July 18, 2008)
Tuesday • $3.48
Week ago • $3.54
Month ago • $3.62
Year ago • $3.32
Record high • $4.11 ( July 17, 2008)