Audrey Gregory stood at the gas pump at Kroger in Columbus Thursday afternoon filling up her SUV.
She doesn’t expect to be back for a while, she said.
“I’m not driving as much, so this tank will last me maybe a couple of weeks,” said Gregory, who is self-employed and lives in New Hope. “Before the virus, I was filling up about once a week.”
Gregory’s story is fairly typical. With shelter in place orders throughout the country, demand for fuel has dropped by 40 percent, which knocked the bottom out of the crude oil market.
“It went from $56 a barrel in February to less than $20 now, which is a 30-year low,” said Don Redman of AAA. “Gasoline prices are following suit.”
In Mississippi, the average cost of a gallon of gas is at $1.52, which is 39 cents lower than it was in February and a full dollar less than it was in April 2019. The average price is slightly higher locally — $1.66 in Columbus and $1.60 in Starkville.
Nationally, the average price of a gallon of gas is 1.79. Wisconsin, with an average price of $1.19, has the lowest average price in the nation.
Matt Bogue of The Dutch Group, which provides Shell gas products throughout north Mississippi, mostly through its Sprint Mart stores, said fuel pricing is a complicated equation.
“It’s almost impossible to boil it down to a simple answer,” said Bogue, who said the lower demand has led to many retailers dropping prices dramatically to compete for customers. “As a local Mississippi business, I can say that when demand is dramatically impacted by an outside force — like COVID-19 — those retailers in the hardest-hit markets are often compelled to price fuel more aggressively in a fight for their share of rapidly dwindling demand.”
In effort to prop up prices, oil executives are cutting refinery production, Redman said.
“In addition to crude oil, market analysts are also watching refinery rates,” Redman said. “The U.S. refinery utilization average is down to 82 percent, a low not seen since September 2017 (when Texas refineries were shut down because of Hurricane Harvey). Given the drop in crude oil prices and in gasoline demand, which is expected to push even lower, refineries are reducing production in hopes this could help to balance the amount of gasoline supply in the country.”
Redman said the trend isn’t likely to change in the immediate future.
“Prices are likely to push lower as Americans are urged to stay at home at least until the beginning of May,” he said.
No problem, said Gregory.
“I’m liking the price right now,” she said. “It’s nice to see something that’s cheaper for a change.”
Slim Smith is a columnist and feature writer for The Dispatch. His email address is [email protected].
You can help your community
Quality, in-depth journalism is essential to a healthy community. The Dispatch brings you the most complete reporting and insightful commentary in the Golden Triangle, but we need your help to continue our efforts. In the past week, our reporters have posted 32 articles to cdispatch.com. Please consider subscribing to our website for only $2.30 per week to help support local journalism and our community.
You can help your community
Quality, in-depth journalism is essential to a healthy community. The Dispatch brings you the most complete reporting and insightful commentary in the Golden Triangle, but we need your help to continue our efforts. In the past week, our reporters have posted 32 articles to cdispatch.com. Please consider subscribing to our website for only $2.30 per week to help support local journalism and our community.
