The average price of gasoline at the pump for U.S. drivers fell to the lowest level of the year as wide spreads between U.S. and European oil benchmarks have driven American refiners to produce more fuel than ever for this time of year.
The average retail price fell 2.9 cents to $3.265 a gallon in the week ended Monday, the lowest level since Dec. 4, the Energy Information Administration reported on its website. Prices are 22.7 cents below a year earlier.
U.S. refineries produced 9.434 million barrels a day of gasoline the week of Oct. 25, the highest seasonal level in weekly EIA data going back to 1982. The discount of Light Louisiana Sweet, the U.S. Gulf benchmark crude, to European Brent, the internatonal benchmark, averaged $6.54 a barrel in October, the widest on record, according to data compiled by Bloomberg.
“The U.S. has finally let go of wanting and needing the world’s benchmark in favor of great refining margins,” said Carl Larry, president of Oil Outlooks & Opinions LLC in Houston. “You have to take advantage of the margins while they’re here.”
Gasoline’s crack spread versus West Texas Intermediate, the benchmark for inland U.S. refineries, was $11.56 a barrel based on New York Mercantile Exchange settlement prices. The fuel was at a 5-cent discount versus Brent.
Gasoline at the pump fell in all geographic regions. It dropped most in the Rocky Mountains, declining 6.1 cents to $3.307 a gallon.
The lowest price was in the Gulf Coast, where gasoline fell 4.2 cents to $3.03 a gallon. It’s the lowest level since Feb. 21, 2011.
The most expensive gasoline was on the West Coast, where prices dropped 4.5 cents to $3.564 a gallon, the lowest price since Jan. 28.
Prices on the East Coast fell 2.9 cents to $3.289 a gallon. Midwest gasoline fell 1 cent to $3.188 a gallon.
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