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(Bloomberg) — Average pump prices in the US fell by nearly 1% overnight, the largest decline since late March 2020, shortly after the Covid-19 pandemic shut down offices and schools across the country, devastating fuel demand.
The national average of gasoline now stands at $3.214 a gallon, according to auto club AAA. That’s the cheapest price American motorists have paid in more than 14 months.
Gasoline’s seasonal weakness this year is compounded by softer-than-usual demand, which fell to its lowest level for this time of year since 1998, excluding 2020, according to trailing 12-month data from the US Energy (NASDAQ:USEG) Information Administration. The drop in fuel use is driven by improving fuel efficiency in the long term and a winter storm sweeping the country in the short term.
Pressure is building on the supply side as well, with Europe poised to export an excess of the fuel to the US. As a result, stockpiles have grown for five straight weeks to levels exceeding those at the same time last year.
(Updates with latest EIA data from third paragraph.)
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