As peak road-trip season comes to a close and the kids go back to school, gas prices are leveling out at historically low rates.
Over the past week, gasoline prices were stable. Nationwide, gasoline averages $2.13 a gallon, the lowest price for this time period since 2004. In Arkansas, a gallon of gasoline averages $1.94, making Arkansas one of 11 states with prices below $2 a gallon.
In Springdale and in Trumann, about 20 miles southeast of Jonesboro, some stations had gasoline listed Friday for $1.74 and $1.75, according to gasbuddy.com. In Fayetteville, Pine Bluff and North Little Rock, prices reached as high as $2.49 for ethanol-free gasoline, though 92 of the 104 stations surveyed sold regular gasoline for $2 or less.
Americans are on pace to beat the record for most gasoline used during summer driving season -- a record set in 2007.
Laurie Taylor, operations manager at Gregg Orr Marine in Hot Springs, oversees gas and boat rentals. She said this has been the marina's best season, partially because of low gas prices.
"If you're doing something like tubing all day, you might go through a full tank, and gas costs are something people weigh when budgeting," Taylor said.
However, demand is still lower than many analysts expected, leading to excess inventories of gasoline.
Oil refineries are producing less gasoline in an attempt to drive the price up. This week gasoline inventories decreased by 2.8 million barrels.
Crude oil inventories are also at historically high levels for this time of year.
In response, oil companies are trying to curtail supply. Crude oil traded at a three-week high on Friday.
"All of the factors that determine what might happen in the future suggest that the price of crude oil will go up, which will affect gasoline prices rather quickly," said Mike Right, regional spokesman for the American Automobile Association.
On Thursday Saudi Arabia's energy minister hinted at a crude oil production cap across both the Organization of the Petroleum Exporting Countries and non-OPEC members.
OPEC will meet in September in Algeria, where Ecuador and Venezuela are expected to call for production cuts. Oil prices could rise if OPEC agrees to slow production.
"There are lots of players in the oil business working night and day to try to get the price of crude oil up," Right said.
Barring OPEC action, experts say the increase in gasoline prices will be slight.
Tom Kloza, chief oil analyst for gasbuddy.com, said he expects prices to stay level until they drop seasonally in September.
"You may see it wobble higher or lower for the rest of the month, but I don't foresee major changes in price," Kloza said.
In September demand drops 4 to 5 percent, and refineries switch to a winter blend of gasoline, shifting supplies.
Going into the fall, Kloza said prices will stay low, but not lower than they were in 2015.
"Since people have short memories, it won't seem so cheap because they're just paying about what they did last year," Kloza said.
Kloza predicts prices will rise considerably in the spring.
"I think by February we'll no longer see gas going for less than $2 per gallon, or the low $ range," he said.
Business on 08/13/2016