Low gas prices expected to continue
FARGO -- Gasoline prices that continue to fall are giving consumers a present whenever they fill their tank, thanks to a supply glut.
Global production of oil continues to soar and demand has softened, sending gasoline to between $1.74 and $1.80 per gallon in the Fargo-Moorhead area.
Experts predict more of the same as low prices should continue through winter.
"I would expect that we would continue to trend lower and remain near current levels through February or early March," said Gene Laducer, a spokesman for AAA North Dakota.
Refineries begin switching to their summer fuel blends in February. As a result, prices at the pump often begin creeping up in March and continue to move up until peaking during the summer driving season, Laducer said.
"We're not expecting to see any significant price increases," he added. As of now, he predicts summer gas prices will peak in the $2.60 to $2.70 per gallon range.
Mike Rud, president of the North Dakota Petroleum Marketers, agreed that low gas prices should remain the norm.
"It would appear that American consumers are going to continue to enjoy low prices at the gas pump," he said. "It's insane the amount of oil that's flowing into the market."
The supply glut could increase in January if Iranian oil begins flowing into the global market, said Rud, who noted that gas prices dipped below $2 over Thanksgiving.
Because of ample supplies, consumers have been cushioned against disruptions that in the past caused sharp spikes in prices.
"We're in some ways bullet-proof to that," Rud said.
That's often been the case for the past five or six years, since the American oil shale boom, including North Dakota's Bakken Formation, he said.
Gas prices are about half of what they were a few years ago.
In North Dakota, the price of gas edged above $4 per gallon in June 2008 and flirted with the $4 mark in May 2011 and October 2012, otherwise remaining in the $3 range.
Consumers are unlikely to see gas prices above $3 next year, Laducer said.