Although the national average of $2.23 was the lowest for the holiday in 12 years, state averages in the southeastern U.S. were the lowest in 13 years. On July 4, gas prices averaged $1.99 in Tennessee – 7 cents less than a year ago and the lowest price for the holiday since 2004.
Tennessee’s daily gas price averages are the lowest since December 2016. The state average declined for the 36th consecutive day Tuesday, for a total of 12 cents since May 29.
Tennessee ranks fifth among states with the lowest average price for regular unleaded. On June 29, the state average dropped below $2 a gallon. Tennessee is now one of six states with gas prices averages below $2 a gallon.
The most expensive gas price averages in Tennessee were in Nashville at $2.04, Memphis at $2.04 and Clarksville-Hopkinsville at $1.98. The least expensive gas price averages in Tennessee were in Chattanooga at $1.89, Johnson City-Kingsport-Bristol at $1.96 and Knoxville at $1.97.
“Unfortunately the pump price plunge may soon come to an end,” said Mark Jenkins, spokesman for AAA. “We are entering a six-week period where demand is normally the strongest of the year. Plus, oil and wholesale prices made solid gains last week, reaching a level that should cause gas prices to level off. Motorists in some markets may see pump prices climb 5-10 cents in the next week or two as a result.”
The oil market has steadily climbed during the past week after EIA data showed domestic oil production lowered by about 100,000 barrels per day, for the week ending on June 23. Moreover, last week Baker Hughes Inc. reported that for the first time in 24 weeks, the U.S. oil rig count declined by two – bringing the total rig count to 756. Neither of these declines are considered dramatic, but the sudden shift in fundamentals was enough to send oil prices higher.
The price of crude rose for the 10th consecutive day Monday, settling at $47.07 per barrel. Crude prices were up $4.54 since reaching this year’s lowest daily settlement of $42.53 on June 21. U.S. crude inventories made small gains, adding 118,000 barrels to total 509.2 million barrels. Domestic crude production recently soared to two-year highs, but dropped last week to its lowest level since April, after declining more than 1 percent to 9.25 million barrels per day. Refineries operated at a slightly lower rate than the week before.
Wholesale gasoline rose for the sixthth-consecutive day Monday, reaching the highest closing price in four weeks. Domestic gasoline production remained strong and well above year ago levels, rising 1.7 percent nationwide on the week; 2.6 percent in the Gulf Coast. Gasoline inventories dropped by 894,000 barrels, but remain almost 1 percent higher than last year. Gasoline demand dipped 2.8 percent and continued to average 2.5 percent lower than last year.