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By: Ragina C. Ali, AAA-Mid-Atlantic
Last weekend’s attack on key Saudi Arabian oil facilities knocked out half of that country’s oil capacity and has led to gas price increases across the country, as well as in Maryland. Some states in our region have seen double-digit weekly increases, including Maryland. Despite these recent increases, Maryland drivers are still paying at least 25 cents less than this time last year.
The gas price average in Maryland today is $2.56, which is up 12 cents in the last week, up three cents in the last month and is 26 cents lower than on this date last year.
Today’s national gas price average is $2.66, up nine cents in the last week, up five cents in the last month and down 18 cents from this time last year.
CURRENT AND PAST GAS PRICE AVERAGES
Regular Unleaded Gasoline
|Today||Week Ago||Month Ago||Year Ago|
|Washington Suburbs(MD only)||$2.66||$2.56||$2.68||$2.90|
|Crude Oil||$58.13per barrel(Thurs. 9/19/19)||$54.85per barrel(9/13/19)||$54.87per barrel(8/16/19)||$70.78per barrel(9/21/18)|
At the close of NYMEX trading Thursday, West Texas Intermediate (WTI) crude oil settled at $58.13 per barrel, $3.28 higher than last Friday’s close. Crude oil prices jumped 14% (from the previous Friday’s close) on Monday, in response to the attacks on Saudi oil facilities. The commodity spike sent gas prices soaring across the U.S. However, crude prices retreated Tuesday and Wednesday after Saudi Arabia reported the damage caused by the weekend attacks was not as bad as initially thought.
“Motorists across the country and here locally are seeing pump prices spike due to the loss of crude oil production in Saudi Arabia,” says Ragina C. Ali, Manager of Public and Government Affairs for AAA Mid-Atlantic. “The situation remains fluid, as how long the price spikes will last is unknown. However, AAA anticipates motorists may pay between five and 20 cents more than what they were immediately prior to the attacks in Saudi Arabia, depending on region and market.”
The Week Ahead
Analysts will continue to watch as the market assesses the crude production situation in Saudi Arabia. A return to full capacity of the damaged facility is expected by end of November however, crude, and therefore gas prices could remain higher as global spare capacity is low. In addition to knocking out approximately half of Saudi Arabia’s crude production, the attacks also severely limited the country’s spare capacity, which serves as a cushion for oil markets. Geopolitical factors could also weigh on the situation including the U.S. and Saudi response to the weekend attacks, as both countries place the blame on Iran.