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U.S. pump prices are expected to rise to the highest since the summer of 2022, to $4/gal, the AAA automobile club warned Tuesday.
Pump prices have been climbing along with crude oil futures in recent weeks by the transition to summer-grade gasoline and as inventories shrink to the lowest since December, while refinery maintenance and unexpected outages caused by leaks and fires also have impacted the market.
The current national average price at the pump is ~$3.53/gal, according to AAA, up $0.27 in the past month; Nymex gasoline futures (XB1:COM) settled Tuesday at ~$2.70/gal, slightly below a recent six-month high.
A refinery fire that potentially lasts for weeks “could really put supply in a tight crunch, just like we saw in the Midwest this winter,” AAA’s Devin Gladden told Bloomberg, referring to the BP refinery in Indiana, in February.
“If we see more incidents like that because of aging refinery infrastructure, that could certainly put a crimp on supply, particularly during the summer when we typically see higher demand levels,” Gladden said.
Front-month Nymex crude (CL1:COM) for May delivery settled -0.4% to $81.62/bbl, while front-month May Brent crude (CO1:COM) closed -0.6% to $86.25/bbl.
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OPEC+ is unlikely to make any oil production policy changes until a full ministerial gathering in June, Reuters reported ahead of next week’s online joint ministerial monitoring committee meeting to review the market, which is not expected to make any policy recommendations.
OPEC+ members led by Saudi Arabia and Russia early this month agreed to extend voluntary output cuts of 2.2M bbl/day to the end of Q2 to support the market.
