U.S. gasoline prices at the pump marked their first decline in 12 weeks on Monday, but demand for the fuel has continued to climb despite near-record high prices, according to GasBuddy.
“Motorists should enjoy the decline while it lasts,” Patrick De Haan, head of petroleum analysis at GasBuddy, told MarketWatch on Monday. “It could be quite short lived given the ongoing Russia war on Ukraine and the responses to it,” such as the European considering banning Russian crude oil.
Support for an EU ban on the purchase of Russian oil is growing inside the bloc, The Wall Street Journal reported Monday, citing diplomats involved in the discussion.
“The only thing motorists should prepare for more of is the volatility,” said De Haan.
National average prices for gasoline stood at $4.238 a gallon on Monday afternoon, down 9 cents from a week ago, data from GasBuddy, a travel and navigation app, show. Prices are still up 71.8 cents a gallon from a month ago, and $1.37 from a year ago. Prices hit their highest recorded average on March 11 at $4.353.
While the decline in prices is “still subject to changes in global supply and demand, COVID and Russia’s war on Ukraine, we are poised to see additional downdrafts at the pump this week,” said De Haan, in a statement acknowledging the first price fall in 12 weeks.
Still, demand for gasoline has “shown absolutely no signs of buckling under the pressure of higher prices,” he said — even as California nears an average of $6 per gallon, “with spring break travel well underway.”
U.S. retail gasoline demand saw a rise of 2.9% last week, from Sunday to Saturday, compared with the week before, according to GasBuddy demand data drive by its Pay with GasBuddy card. Meanwhile, California’s price average was $5.85 Monday afternoon, up 10.2 cents from a week ago and $1.99 higher than a year ago.
If the situation does worsen, “with more oil being kept away from global markets, it’s not impossible that gas prices would still have to climb a considerable amount for Americans to start curbing their insatiable demand for gasoline,” De Haan said.