The average price of regular unleaded gas is now $3.34 per gallon in Michigan, a drop of four cents from last year. This also means that prices are 37 cents lower from the same time last month and a significant reduction of $1.02 compared to last year’s prices. However, in Alger County, motorists are paying almost 30 cents more a gallon than the state average.
Motorists in Michigan are now paying an average of $50 for a full 15-gallon tank of gasoline, which is a discount of around $28 compared to the highest price recorded in June 2022.
However, recent data from the Energy Information Administration (EIA) shows a significant spike in gas demand, rising from 8.62 to 9.30 million b/d. While this increase was more substantial than expected, there is a possibility that the final demand measurements for May could result in a revision of this estimate. The demand for gas has resulted in a reduction in stocks, with domestic gasoline stocks falling by 3.2 million bbl to 219.7 million bbl. The reduction in stocks has slowed down the decrease in pump prices.
WTI, the benchmark crude oil price in the US, declined by $1.15 to settle at $72.56 at the close of Wednesday’s formal trading session. The decline in oil prices is due to ongoing market uncertainty regarding stalled US debt ceiling negotiations. The market is concerned that breaching the debt limit could result in an economic recession, which would likely cause crude demand and prices to decrease. The EIA has also reported an increase in domestic commercial crude inventories, rising by 3 million bbl to 462.6 million bbl, according to AAA.
“An increase in demand would typically lead to higher gas prices, however low crude oil prices have helped Michigan motorists see some stability at the pump,” said Adrienne Woodland, spokesperson, AAAThe Auto Club Group. “If demand continues to grow, alongside tighter gasoline stocks, the downward trend in pump prices could slow.”
In Alger County, the average was $3.636 on average, making it the third-highest in the state and second-highest in the Upper Peninsula. Chippewa County is the most expensive in the U.P. while Leelanau County is the most expensive at $3.671.
