Durango enjoyed the cheapest gas prices in the state in mid-December based on a 10-city survey conducted by AAA Colorado.
Also, prices throughout Colorado could drop by as much as a quarter by New Year’s Day because of increasing gasoline stocks and reduced winter driving miles, said Skylar McKinley, director of public relations and government affairs for AAA Colorado, in a news release issued Thursday.
According to a AAA price survey, Durango enjoyed the cheapest gas prices in Colorado for the third week of December, with Durango’s average price for a gallon of regular unleaded listed at $2.57 per gallon.
The next lowest price of 10 Colorado cities surveyed was Denver at $2.68. Vail had the highest price in the state at $3.19.
“Gas from Durango comes from a different region than the rest of the state, from New Mexico, and that region has been better stocked and has had less demand for gas than stocks that supply the rest of Colorado,” McKinley said. “It’s good news for now. Let’s see how long it lasts.”
Also, some refineries in California unexpectedly shut down in late summer and gas supplies have been diverted from Colorado to California, driving up prices in Colorado, but Durango has largely avoided that with gasoline coming from the Albuquerque market, he said.
Regional gasoline stocks have averaged 7 million barrels since early October based on data from the Energy Information Administration, McKinley said.
McKinley said refinery utilization rates have hovered around 85%, and combined with healthy amounts of gasoline, those two factors indicate prices should be heading down statewide by Jan. 1.
In addition, refineries have switched to make winter-blend gas, which is cheaper to produce and sell.
“Pump prices are finally trending downward in Colorado in what has been an abnormally expensive regional gas market of late,” McKinley said. “The even better news is that 2019’s prices are down nearly a dime from 2018, thanks in large part to cheaper crude oil prices.”
On a year-to-date basis, Colorado’s 2019 statewide average for a gallon of regular unleaded is $2.57, down from $2.68 in 2018. Gas prices hit their highest point in June, at $2.87, and their lowest in February, at $2.01.
Colorado has enjoyed the cheapest gas prices of any state in AAA’s Rockies analysis region – comprising Idaho, Montana, Utah, Wyoming and Colorado.
McKinley warned the lower prices may not last long.
Earlier this month, OPEC and other major global producers, including Russia, announced an agreement to cut their total crude production by an additional 500,000 barrels per day beginning Jan. 1. This new agreement will likely remain in effect, without amendment, until the next OPEC meeting in Vienna, Austria, on March 5.
“This reduction in global crude supply will help drain the market, which will likely otherwise be oversupplied during the first half of next year,” McKinley said. “This could lead to more expensive crude oil and gas prices in mid-to-late January as compared to the start of recent years, assuming crude demand remains robust.”
parmijo@durangoherald.com
