Prices for a gallon of gasoline across Alabama have plummeted amid a glut of supply from overseas coupled with a lack of customers due to coronavirus precautions.
According to data collected by AAA, the average price of a gallon of regular unleaded in Alabama was $1.689 on Wednesday, the lowest since 2016, and one of the lowest prices for the state in the last 15 years.
United States consumers went through 6,659,000 barrels of gas per day during the week ending March 27, a 37% decrease from the same week one year earlier and the lowest weekly number since the 1990s.
That number is expected to fall further, as more states have enacted “shelter-in-place” and “stay-at-home” orders since the most recent data was tabulated.
J. Bart Fletcher, head of the Petroleum & Convenience Marketers of Alabama, an industry group, told Yellowhammer News over the phone that he has had many conversations with the convenience store owners that comprise his organization.
“I’m hearing anywhere from 20-40% drop in retail volume across the state,” he said when asked about how the coronavirus precautions were affecting sales.
According to Fletcher, rural stations are seeing less of a dropoff in sales than urban stores.
In addition to the drop in travelers caused by coronavirus precautions, oil prices have been subjected to a feud between Russia and Saudia Arabia, two of the largest oil-producing countries.
Saudia Arabia, in early March, reduced the prices of its crude oil output in an attempt to undercut Russian prices and gain dominance on the international market.
Russia, unfazed, proceeded apace with their oil production, resulting in an increased drop in prices for most customers around the world.
A meeting to potentially end the feud was postponed late last week.
“The issues we’ve seen with Saudi Arabia and Russia … is really the primary reason for the lowering of the retail gasoline prices,” Fletcher told Yellowhammer.
“Like any other product, the wholesale price determines what the retail price will be,” he added.
Fletcher said the convenience stores across Alabama are worried about “maintaining an adequate supply of employees,” which he says is a challenge faced by retailers across the state.
“My members are installing plexiglass between their retail clerks and their customers,” said Fletcher when asked how stores are adapting to these times of crisis.
Fletcher promised that his members will stay open and ready to serve across the state “so that people can keep on with their lives to the best degree possible.”
Henry Thornton is a staff writer for Yellowhammer News. You can contact him by email: henry@new-yhn.local or on Twitter @HenryThornton95.
