Fuels

Retail Margin Slashed

Gasoline price cutting likely to continue, says Lundberg

CAMARILLO, Calif. -- The Nov. 16 U.S. average price of regular grade gasoline was down 7.26 cents per gallon to $3.4728, according to the most recent Lundberg Survey (www.lundbergsurvey.com) of approximately 2,500 U.S. gas stations. It is down 36.47 cents from six weeks ago, which along with the current price premium of just 9.21 cents vs. the year-ago price, is salve for hard-pressed consumers.

Between Oct. 5 and Nov. 16, the average retail price in California caved 73 cents per gallon, twice as much as the national average did as prices down-corrected after the Oct. 5 spike.

Gasoline demand took multiple hits, with the loss of Daylight Saving Time on top of the seasonal decline in consumption happening anyway, and the impact of storm Sandy on Northeast markets--all on top of a generally fragile economy with underemployment still rife. Unless crude-oil prices should suddenly take flight from geopolitical conflict or other reasons, further price declines at the pump near term are probable.

Refinery margin on gasoline shrank a bit during the past two weeks, but retail margin dropped far more. The Nov. 16 U.S. average retail margin on regular grade is a skinny 8.03 cents per gallon on regular grade, down about a third from Nov. 2. A bounce up from the currently narrow margin should be expected soon.

Camarillo, Calif.-based Lundberg Survey Inc. is an independent market research company specializing in the U.S. petroleum marketing and related industries.

Click here for previous Lundberg Survey reports in CSP Daily News.

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