Current Gasoline Price Average Posts an Overnight Increase

The AAA Daily Fuel Gauge Report shows that the current gasoline price average of regular unleaded posted an overnight drop from $3.459 to $3.456 per gallon

In spite of the fall, the average gas price in Knoxville, Tennessee is still higher by around 7 cents compared to last week.

In the meantime, the country’s current gasoline price average moved up by less than a cent to $3.696 a gallon, said the AAA, OPIS and Wright Express. That rate is almost 30 cents above last month and 10 cents higher than the past year.

Most of the change is attributed to Japan’s announcment of a lower than expected economic growth for quarter two. Consumer spending, accounting for more than fifty percent of the country’s economic activity, dropped. Moreover, export demand was disappointingly low.

Economies of other countries in Asia, particularly China as the biggest oil importer, and India, have also slowed down. That is a major concern since the Asia-Pacific region supported the world economy when Europe and U.S. started to slow down.

The news about Japan arrived following the IEA’s reduction of this year’s forecast for the demand for global oil due to a weak economy.

The oil price per barrel in the NYMEX drops 14 cents to end at $92.73. The fall reflects a decrease in the prices of U.S. stocks.

In London, the oil price per barrel of Brent gained 65 cents to finish at $113.60.

Brent is probably receiving support from traders who are worried about supply interruptions from the Middle East due to possible regional conflict. The tension can impact oil shipments through the Hormuz Strait, where twenty percent of the global oil is transported.

Elsewhere in the energy markets, the price of heating oil declined by less than a cent to end at $3.02 a gallon. Gasoline dropped 1.32 cents to close at $2.99 a gallon. The price of natural gas fell 4 cents to finish at $2.73 for every 1,000 cubic feet.

By: Chris Termeer