Oil supply to keep gas prices low through the summer

EIA gas priceGas prices are projected to be more than a dollar per gallon lower this summer than during the summer of 2014, the U.S. Energy Information Administration predicted Wednesday.

Basing the projection on a large drop in Brent crude oil prices, the EIA estimated U.S. average regular gasoline retail prices will average $2.45 per gallon during the April through September 2015 period, down from $3.59 per gallon last summer.

The group’s April 2015 Short-Term Energy Outlook reported that global crude oil supply exceeded demand in late 2014 and early 2015, which, combined with average refining margins projected at the same level as last summer, will create a lower average price.

Regional differences that include factors such as costlier gasoline blends will result in a higher price on the West Coast, with an average of $2.82 per gallon.

The lowest gasoline price projected for the summer of 2015 is along the Gulf Coast, with an average of $2.25 per gallon. Prices in the Midwest, East Coast and Rocky Mountains are projected to average $2.41 per gallon.

Falling oil prices have been good news for consumers at the pump, but have had adverse effects on construction equipment manufacturers, particularly Caterpillar, but also Komatsu.