The latest data from the U.S. Energy Information Administration (EIA) showed that on Monday the average cost for Regular gasoline in America fell to $2.15 per gallon. That was the 9th weekly decline in a row and a more than 10 percent decrease from the 2016-to-date high of $2.40 per gallon hit in June. Regionally, the cheapest gas in the country can be found in South Carolina, where a gallon of Regular costs just $1.81 on average. Residents of California as usual have to pay the most in the continental U.S. for Regular ($2.62/gallon), and San Francisco is also the city with the nation’s highest average price ($2.82/gallon). The recent pullback at the pump is not too surprising since the cost of oil has also declined considerably since mid-June, with West Texas Intermediate (WTI) crude even dipping below $40 per barrel earlier this month. However, a short-covering rally has caused the price of oil to spike over the past week, and hedge funds and other money managers have boosted their net long positions in Brent and WTI derivatives by the equivalent of 48 million barrels, the largest such increase since May. A major factor behind the bullish shift is the market’s growing expectation that a production freeze will be announced by OPEC oil ministers at the International Energy Forum in Algeria next month.
Sources: U.S. EIA, DShort, GasBuddy, Bloomberg, Twitter, Reuters, CME, ICE, CFTC
Post author: Charles CouchDisclosures