After weeks of speculation, OPEC made it official last week by announcing they will restore oil production at a faster clip than expected. Patrick DeHaan, head of petroleum analysis with Gasbuddy.com, says the increased production will start in June.
“Raising production by over 400,000 barrels a day, OPEC has been making a lot of surprising announcements, as of late but certainly has some challenges. Kazakhstan has been noticeably talking about potentially increasing oil production, and so OPEC is likely having to act here now to stem some of that frustration among Kazakhstan.”
DeHaan added that while it remains to be seen how far oil prices will drop, this decrease will certainly help U.S. motorists with lower fuel prices in the weeks ahead. But, at this point, those lower prices have yet to be realized.
“Much of that is due to refinery maintenance and turnarounds that are ongoing. But in the weeks ahead, as that maintenance and turnaround work finishes. I do expect that you will start to see lower gasoline, diesel, and jet fuel prices across the U.S., and that’s something that could ultimately bring the national average to fall below $3 a gallon here in time for the summer driving season.”
On Wednesday, AAA pegged the average price of Indiana unleaded gas at $3.13 per gallon, a nickel below the U.S. average. The average price of diesel in Indiana was $3.56 per gallon.
Sources: NAFB News Service, AAA
