Gas prices heading north

By BRIAN WALKER

Staff Writer

COEUR d'ALENE — Milt Simpson believes AAA's latest disclosure on the state of gas stinks.

The travel agency predicts market conditions will push pump prices higher in the coming weeks.

The average in Coeur d'Alene on Thursday was $2.40 per gallon, which was tucked between Idaho’s and Post Falls' average of $2.52 and the nation's number of $2.27.

"Lower prices just never seem to last," said Simpson, who lives in Post Falls and filled up at a Coeur d'Alene station Thursday. "I just hope they don't rise to $3. That's when it really starts to pinch."

Matthew Conde, AAA spokesman, said he doesn't think prices will rise to that painful point in the foreseeable future.

"I think it would take something extraordinary to get prices up to the $3 mark," Conde said. "It could happen, but at this point, there aren’t strong enough indicators to suggest that it will. Going just off what we know today, prices will likely top out in the $2.70 to $2.80 range across the state."

Since mid-June, Coeur d’Alene prices have dropped 9 cents from the 2017 high of $2.49 a gallon.

"It’s interesting to note that parts of northern Idaho have cheaper fuel than a year ago, while most of the state is paying more for gas this year," Conde said.

Prices have been steadily declining since early June across the country. It's an unusual occurrence marked by strong seasonal demand, but even more abundant supplies of gas and crude oil.

Since July 4, Idaho has slowly followed suit. The U.S. average dropped by 8 cents over a six-week span, and Idaho prices have dropped 4 cents since the first of the month.

January through June also brought record growth in the number of U.S. oil rigs. There are 765 active rigs — 408 more than last year’s count at this time.

"U.S. production is growing at a rapid rate," Conde said. "Overall, there has been a massive glut of crude oil in the global marketplace, but over the next six or seven weeks, industry experts believe inventories will continue to draw down, putting upward pressure on gas prices."

For the week ending July 7, crude oil inventories dropped below 500 million barrels for the first time since late January. Crude oil on Thursday was trading at $47, an increase of $2 over the past week.

Meanwhile, summer travel demand is expected to remain strong until Labor Day weekend, Conde said.

"We may even see a new record high between now and early September," he said. "Unemployment rates are low, and current gas prices are considered affordable when compared to recent years. Although pump prices may be on the move in the coming weeks, now is a great time to hit the road."