After holding steady last week, gas prices in Tennessee rose three cents, on average, over the last week. The Tennessee Gas Price average is now $2.72 which is 3 cents more than one month ago and $1.12 more than one year ago.
As of Monday, the average price for a gallon of regular unleaded gasoline in Coffee County was $2.64, which is 8 cents below the state average and 32 cents below the national average of $2.96.
“The shutdown of the Colonial Pipeline late last week will likely have implications on both gasoline supply and prices in Tennessee, and those could happen as early as this week,” said Megan Cooper, spokesperson, AAA – The Auto Club Group. “The longer the pipeline is down, the greater the threat of rising gas prices. Tennesseans may see prices increase three to seven cents this week.”
· 69% of Tennessee gas stations have prices below $2.75
· The lowest 10% of pump prices are $2.53 for regular unleaded
· The highest 10% of pump prices are $2.99 for regular unleaded
· Tennessee moved to the 8th least expensive market in the nation this week
National Gas Prices
On the week, the national gas price average jumped six cents to $2.96. If the trend continues, an increase of three more cents would make the national average the most expensive since November 2014 –the last time we saw average prices at $2.99 and higher.
AAA forecasts gas prices to climb this week in reaction to the shutdown of the Colonial Pipeline, which delivers approximately 45% of all fuel to the East Coast. Over the weekend, the Colonial Pipeline announced they were the victim of a cybersecurity attack and, as a precaution, shut down the pipeline, which runs from Texas to New York Harbor. At this time, some lateral lines have reopened, but there is no word of when the mainline, including the gasoline line, will be operational.
The longer the pipeline is offline, the larger the impact on the east coast. However, foreign gasoline imports and other pipelines can supplement Northeastern supply. Other areas of the country will see little impact.
While there is sufficient gasoline supply in the U.S. (235.8 million bbl), other pipelines and the Department of Transportation’s temporary hours-of-service exemption for tanker trucks transporting gasoline and other fuels, will be able to ease the strain, but not resolve the issues caused by the pipeline interruption. Once the pipeline is up and running, there could still be residual delays as it takes about 15–18 days for fuel to flow from Texas to New York.
AAA will continue to monitor the latest news concerning the Colonial Pipeline. In the meantime, we urge against panic-buying of gasoline. Keep these tips in mind to conserve fuel:
· Plan ahead to accomplish multiple errands in one trip, and whenever possible avoid high-traffic times of day.
· If you own more than one car, use the most fuel-efficient model that meets the needs of any given journey.
· Remove unnecessary and bulky items from your car. Minimize your use of roof racks and remove special carriers when not in use. It takes more fuel to accelerate a heavier car, and the reduction in fuel economy is greater for small cars than for larger models.
· Minimize your use of air conditioning. Even at highway speeds, open windows have less effect on fuel economy than the engine power required to operate the air conditioning compressor.
· In hot weather, park in the shade or use a windshield sunscreen to lessen heat buildup inside the car. This reduces the need for air conditioning (and thus fuel) to cool down the car.
National Oil Market Dynamics
At the close of Friday’s formal trading session, WTI increased by 19 cents to settle at $64.90. Market optimism that crude demand will recover, despite an uptick in coronavirus infection rates, helped to lift prices last week. Prices could continue to climb this week if the market remains optimistic as vaccines continue to rollout. Additionally, prices increased after the Energy Information Administration’s (EIA) latest weekly report revealed that total domestic crude oil inventory dropped by 8 million bbl to 485.1 million bbl. If EIA’s next report shows another decrease in total domestic crude supply, crude prices could climb further this week.