-March 9,2020-
Gasoline futures are down around 80 cents today from a January high but there is some doubt you will see the same kind of savings at the pump any time soon.
In our reading areas the cheapest price in Visalia is $2.86 at Costco and $2.55 a gallon at several Farmersville stations.
The average gasoline price in San Luis Obispo is $3.67 a gallon and $3.35 statewide – all priced before oil collapsed this Sunday/Monday .
Gas Buddy notes that when the global markets opened on Sunday evening, West Texas Intermediate (WTI) crude oil prices dipped below $30/bbl for the first time since 2016. The market plunge is in response to a lack of agreement between Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC countries to cut production. The trend of pump prices facing downward pressure is likely to continue through the end of the winter driving season if crude remains cheap, especially amid concerns about the coronavirus.
Oil had been near $60 a barrel and now it is trading at $31 a barrel mid-day Monday.
A year ago California gas averaged $3.19 when oil sold for $63 a barrel. Gas sold for $2.80 a gallon in March 2017 when oil was $49 a barrel.
Today Chevron’s Kern crude oil price is $40 a barrel March 9 and likely to be in the $30s tomorrow. That ought to take the average fuel price in California in the next week plunging well below $3 statewide. We will see if it happens.
The last time gasoline was consistently below $3/gallon in 2016 when the average oil price was in the mid-$40s. Given oil’s new reality, how about we see $2.50 gallon gas at my neighborhood filling station.