According to MasterCard, U.S. gasoline demand fell for a second consecutive week to the lowest level in two months.
Drivers bought 0.7 percent less gas than the previous week (May 4) for a total of 8.59 million barrels, according to MasterCard‘s SpendingPulse report.
Further, Americans were consuming approximately 5.8% less fuel than this time last year. That marks the 36th straight decline from that perspective. Our fuel use for the previous four weeks is down more than 6% from this time in 2011. Again, this is a huge drop – and it’s also a record 59th consecutive drop in that measure.
At the pump, Americans might have noticed a three cent drop from this time last week, putting the average cost of fuel across the nation at $3.81 per gallon. It’s not been this low in two months and the drop marks a continuation in lowering prices.
While prices have fallen 13 cents in the past four weeks, keep in mind that they do not always translate to an instantaneous pickup
said John Gamel, a gasoline analyst and director of economic analysis for SpendingPulse, said in the report.
The west coast is still where the highest prices are found, and the numbers fell about one percent to $4.12 a gallon. The lowest prices were found along the southern Gulf Coast – Mississippi, Alabama, Louisiana, Texas and Florida and the price of a gallon of gas fell six cents to $3.68.
The report, assembled by MasterCard advisers, was conducted by Purchase, the credit card company’s consulting division. The information is based on credit card swipes and cash and check payments at about 140,000 U.S. gasoline stations. Another interesting fact is Americans appear to be charging gas slightly more than they are paying cash.
Despite predictions of fuel prices rising, perhaps even to $5.00 or more a gallon by this summer, it appears prices are falling in a rather consistent manner. According to the U.S. Energy Information Administration, which projects anticipated fuel costs, the average retail price through 2012 should hover around $3.83 EIA’s projection for 2013 is $3.87 per gallon.
In late 2011 and early 2012, estimates were significantly higher. Still, there remain many dynamics at play that could alter what ultimately happens. Prices rose a staggering nineteen cents over a three week period earlier in 2012 to an average of $3.48 per gallon, which is a stark contrast when compared to the average of $3.12 a year ago and $2.67 in February 2010. Prices along the Gulf Coast are already significantly lower. Some analysts said gas prices would be sixty cents higher by now.
It was believed renewed tensions in the Middle East would be a driving force behind bolstering crude prices, while other speculators are boosting futures contracts, based on predictions of global supply disruptions and tighter refining capacity. Several U.S. and overseas refiners have experienced temporary or permanent closures, though it appears these haven’t been strong enough factors.
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