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Economy in Brief

U.S. Petroleum Prices Improve
by Tom Moeller  May 5, 2020

• Crude oil prices rose last week following the prior week's collapse.

• Gasoline prices increased two cents.

• Natural gas prices weakened further.

The spot price of West Texas Intermediate crude oil rebounded to $15.65 per barrel (-75.1% y/y) in the week ended May 1. The record low average of $3.64 set in the previous week was distorted by daily prices falling into negative territory (-$36.98 per barrel on April 20). Yesterday, the price was $20.39 per barrel. The price of Brent crude oil also recovered to $23.45 after falling sharply to $21.75 per barrel which was the lowest since March 2002. These prices were down from the weekly high of $84.96 early in October 2018.

Retail gasoline prices improved  to $1.79 per gallon (-38.2% y/y) in the week ended May 4 from $1.77 per gallon in the previous week. Haver Analytics adjusts the gasoline price series for regular seasonal variation. The seasonally adjusted price held steady at $1.67 per gallon and remained at the lowest since January 2004.

The average price of natural gas slumped to $1.71/mmbtu (-34.3% y/y) in the week ended May 1 from $1.85/mmbtu the previous week. This was the lowest price since early last month. The price of natural gas is down from $4.67/mmbtu late in November 2018. Yesterday, the price rose to $1.78/mmbtu.

Reduced demand for oil and products is behind the collapse in prices. In the four weeks ending April 24, gasoline demand plummeted 43.7% y/y, while total petroleum product demand fell 28.0% y/y. Crude oil input to refineries declined 21.0% y/y in the past four weeks. At the same time, gasoline inventories rose 14.5% y/y and inventories of all petroleum products increased 6.0% y/y.

These data are reported by the U.S. Department of Energy. The price data can be found in Haver's WEEKLY and DAILY databases. Greater detail on prices, as well as the demand, production and inventory data, along with regional breakdowns, are in OILWKLY.

Weekly Energy Prices 05/04/20 04/27/20 04/20/20 Y/Y % 2019 2018 2017
Retail Gasoline ($ per Gallon Regular, Monday Price, End of Period) 1.79 1.77 1.81 -38.2 2.57 2.27 2.47
Light Sweet Crude Oil, WTI ($ per bbl, Previous Week's Average) 15.65 3.64 20.11 -75.1 56.91 64.95 50.87
Natural Gas ($/mmbtu, LA, Previous Week's Average) 1.71 1.85 1.72 -34.3 2.57 3.18 2.99
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