US Gas Prices Fall Everywhere Except New York

Some critics say the Jones Act is to blame for higher gasoline prices in regions of the United States not serviced by pipelines.

By Chunzi Xu (Bloomberg) Americans across the country will enjoy fast-falling gasoline prices just in time for Thanksgiving — except for in New York.

The national average price for gasoline has shed about a dime over the past week and a half, with more declines likely as wholesale prices slump in some regions to the lowest since last year. While some Midwestern states like Wisconsin and Michigan saw pump prices decline more than 4 cents a day, New York’s average price fell by less than a cent – the smallest decrease of all lower 48 states, according to auto club AAA.

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Nationally, prices have softened as refiners come roaring back to life from maintenance downtime, while the country’s fuel consumption lags seasonal norms. Demand for this time of year has been lower only once in the last decade, in 2020 when Covid emptied the roads, government data show. However, even as gasoline stockpiles refill around the country, inventories in New York and the wider East Coast region remain at the lowest seasonally in a decade.

The supply imbalance highlights the transportation bottlenecks that trap fuel in the Gulf Coast and punish East Coast consumers with higher prices. The country’s main conduit for fuel, the Colonial pipeline, has been fully booked for gasoline for months, and shippers are paying as much as 20 cents a gallon for space to ship on the line. Traders rarely send gasoline by ship from the Gulf Coast to New York because of the Jones Act, which requires such shipments to occur on US-built vessels. 

New Yorkers are paying about 30 cents a gallon more than they did a year ago and can expect to pay an additional 16 cents a gallon to fill up when the state’s tax suspension ends.

Meanwhile, prices are now lower in Georgia compared to last year and Texans are paying just a few cents above what they did a year ago. Wholesale prices on the Gulf Coast and in the Midwest are at their lowest levels since December, Bloomberg data show. Even the West Coast, where prices are typically the highest, is enjoying sharp declines. Wholesale fuel prices in Los Angles have fallen by more than 60 cents a gallon, while the average retail price in California fell nearly a dime in the last week. 

Low prices are good news for the 48.7 million people expected to drive more than 50 miles this Thanksgiving, which AAA forecasts will be the third busiest for travel since data began in 2000.

Related Book: The Prize: The Epic Quest for Oil, Money & Power by Daniel Yergin

By Chunzi Xu, with assistance from Joe Aboussleman. © 2022 Bloomberg L.P.