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Kentucky has largest price drop at gas pumps in nation during past week; average cost now $1.99

Kentucky gas prices have dropped 4 cents in the past week, the biggest drop seen of any state. Most areas saw gas prices decrease minimally over the past week, with the majority seeing a one or two cent decline, or no change at all.

Though not big drops, the volatility was enough to drive the national average down a penny over the past week, now landing at $2.17. Today’s national average is two cents less than last month and 49 cents cheaper than a year ago.

“As we move into the second week of the August, it is pricing out to be the second-cheapest start to the month in more than a decade,” said Lori Weaver Hawkins, manager, public and government affairs, AAA Blue Grass. “Gas prices have great potential to push cheaper, especially with many school districts opting not to bring students back to the classroom for in-person learning. This could drive demand down in the weeks ahead, as school starts virtually.”

In the latest Energy Information Administration (EIA) weekly report, gas demand fell from 8.8 million barrels per day to 8.6 million barrels per day, while stocks held steady at 247 million barrels.

Gas Prices in the Bluegrass

Today’s average of $1.99 in Kentucky is down 4 cents from last week and down 8 cents from a month ago. It is also considerably lower than the average of $2.45 seen a year ago. In Lexington, the average price is down 6 cents from the past week, landing at $1.95. That’s 14 cents lower than just a month ago.

Quick stats

The nation’s top 10 largest weekly changes: Utah (+9 cents), Michigan (+6 cents), Kentucky (-4 cents), Ohio (+3 cents), Florida (-3 cents), Tennessee (-3 cents), West Virginia (-3 cents), Pennsylvania (+2 cents), Texas (-2 cents) and Oklahoma (-2 cents).

The nation’s top 10 least expensive markets: Mississippi ($1.81), Texas ($1.84), Louisiana ($1.84), Oklahoma ($1.86), Arkansas ($1.86), Alabama ($1.87), Missouri ($1.87), South Carolina ($1.88), Tennessee ($1.89) and North Carolina ($1.94).

2020 Hurricane Season

While Hurricane Isaias did not disrupt gas prices, the 2020 hurricane season is far from over. Last week, the National Oceanic and Atmospheric Association (NOAA) released the association’s annual August update, which revised the May forecast of 13-19 storms to a newly predicted 19-25 storms through the end of November. This year’s season could be one of the busiest, as it has already produced a record-setting nine named storms.

Major storms and hurricanes that take crude and gasoline infrastructure and refineries offline have the largest impact on gas prices.

One positive factor for this year ― U.S. gasoline supply is plentiful, sitting at a 17-million-barrel year-over-year surplus. If a major storm or hurricane does hit the U.S., it will be a matter of short-term shortages and how quickly gasoline stocks can get to areas of need.

Oil Market Dynamics

At the end of Friday’s formal trading session, WTI decreased by 71 cents to settle at $41.22 per barrel. Domestic crude prices decreased last week due to a weak U.S. dollar and after EIA’s weekly report revealed that total domestic inventories decreased by 7.4 million barrels, bringing total domestic stocks to 518.6 million barrels. The decrease in total supply, amid low gasoline demand, could mean that the domestic crude market is rebalancing. Crude prices have the potential to stabilize this week if EIA’s report shows continued growth in demand alongside a reduction in supply.

Motorists can find current gas prices along their route with the free AAA Mobile app for iPhone, iPad and Android. The app can also be used to map a route, find discounts, book a hotel and access AAA roadside assistance. Learn more at AAA.com/mobile.

From AAA Blue Grass

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