Gas prices in Michigan fall to $3.45 as crude oil prices drop — but trend unlikely to last
The average gas price in Michigan fell Monday 8 cents from a week ago to $3.45 a gallon for regular unleaded, according to AAA, as crude oil prices dropped amid rising market concerns about the health of the global banking sector.
This price is 18 cents more a gallon than a month ago, but still 78 cents less than it was last year.
"Michigan motorists are seeing some slight relief at the pump as prices drop across the state," said Adrienne Woodland, a spokesperson for the AAA Auto Club. "If crude oil prices keep falling, drivers could see pump prices continue to decline."
More demand, cheaper crude
Gas demand increased slightly from 8.56 million to 8.59 million barrels a day, according to new data from the Energy Information Administration. Meanwhile, total domestic gasoline stocks decreased by 2.1 million barrels of crude oil to 236 million. Increased demand amid tighter supply usually pushes pump prices higher.
However, lower oil prices have countered this effect.
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West Texas Intermediate oil, a benchmark used by oil markets, decreased by $3.72 a barrel to $67.61 at the close of Wednesday’s formal trading session. AAA said low confidence in the banking sector and fears that regulatory responses could tip the economy into a recession pushed crude demand down alongside prices.
Most, least expensive gas
Metro Detroit’s average daily gas price also decreased about 7 cents to $3.48 per gallon.
The most expensive gas price averages: Marquette, $3.50; Ann Arbor, $3.49 and Jackson, $3.48.
The least expensive: Grand Rapids, $3.39; Benton Harbor, $3.40 and Flint, $3.41.
Lower prices unlikely to last
The nation’s average price of gasoline has declined, falling 4.2 cents from a week ago to $3.40 per gallon for the first time in two weeks, according to GasBuddy. The national average is up 4.3 cents from a month ago, but 82.9 cents per gallon lower than a year ago.
The national average price of diesel fell 5.6 cents in the last week to $4.25 per gallon."The broad concern over recent failures of the U.S. and global banking system has put enough downward pressure on oil prices that we saw a reprieve in rising gasoline prices," said Patrick De Haan, GasBuddy's head of petroleum analysis. "But, it may be temporary in nature, and is unlikely to be a long-lasting trend."
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This article originally appeared on Detroit Free Press: Low oil prices lead to falling gas prices in Michigan