As U.S. drillers are producing more crude than ever and the nation's refineries export products at levels not seen before, the downside seems to be appearing at the pump in the form of higher prices for Americans set to travel this summer.
A new pipeline is relieving a stockpile of oil previously stuck in the middle of the country, moving it to refineries on the Gulf Coast, which exports growing amounts of gasoline and diesel fuel, the Wall Street Journal reports.
As a result, U.S. gasoline stockpiles are near a three-year low, according to the U.S. Energy Information Administration, and prices are about 4 percent higher than a year ago. On Monday, regular gasoline in the U.S. averaged $3.68 a gallon, the highest price since March 2013, EIA said.
In recent years, the nation's market has been flooded with oil, helped by the shale boom, which kept domestic crude prices low, relative to world prices. During the economic recovery, low demand encouraged refiners to increase exports, and now, the U.S. fuel market is aligning with the global gasoline market to pressure prices.
Total petroleum exports, mostly gasoline and diesel, averaged about 3.6 million barrel a day last week, a 25 percent increase over the same period last year. And, analysts say export demand is growing. Indeed, ESAI, an energy research firm based in Wakefield, Mass., predicts the U.S. will become a net gasoline exporter by 2015.
The EIA estimates U.S. gasoline prices will average $3.57 a gallon between now and September. That’s a penny less than last year. AAA estimates gas prices will be between $3.55 and $3.75 a gallon this summer.