In a little more than 30 days, the average price of a regular gallon of gas in Flagstaff’s metropolitan area rose more than 50 cents. According to recent history, the increases across Coconino County won’t slow down until July at the earliest and could run even later into the year.
Sitting at $2.515 on Sunday, March 17, the price per gallon began its rapid rise as the new week started, according to GasBuddy.com. Just two days later, the price rose to $2.567 and ended the week at $2.722 on March 24. As of April 19, a gallon of gas stood at $3.067 in Coconino County, a 55-cent increase.
During that span, the price has fallen just twice, by a meager .002 cents between March 30 and 31 and .012 cents from April 5 and 6.
Meanwhile, as Flagstaff and Coconino County have been hit hard by rising prices, the national increase has been moderately more steady. The U.S. average stood at $2.543 on March 17 and rose to $2.848 by April 19, a steep increase of 30.5 cents but well below Flagstaff’s rate.
The state of Arizona as a whole jumped during the time period as well, moving from $2.568 to $3.072 from March 17 to April 19. Starting out 5.4 cents under the state’s average, Flagstaff now is nearly identical and ranks as the 64th highest metropolitan area for gas in the nation. As a state, Arizona ranks seventh nationally for gas prices and is one of the seven to hold an average price higher than $3. All seven of the nation’s leaders reside in the west, with California’s average price now topping out at more than $4.
Route 66 Maverik station manager Robert Hack said the price increases consumers are currently seeing are in part a result of the Dec. 7, 2018 decision by the Organization of the Petroleum Exporting Countries (OPEC), a group of 14 of the world's major oil-exporting nations. The organization and 10 nonmember allies agreed to cut oil production by 1.2 million barrels per day in response to the drop in oil futures.
“The bottom line was OPEC decided the supply and demand situation needed some serious adjustment, so they pulled back on the supply big time,” Hack said. “You’ll have seen probably after about 60 or 90 days, all of the surplus that was out there started to get used up.”
Crude oil prices also rose slightly in the past month after hitting a low point late in December 2018. Brent crude oil futures, the international benchmark for the price, rose from a closing price of $67.54 per barrel on March 17 to $71.92 on April 17. During the same span, U.S. West Texas Intermediate (WTI) crude futures moved from $59.09 to $64.18.
Brent peaked at around $86 per barrel in early October before slipping to nearly $50 before Christmas, a new low since the summer of 2017, before steadily increasing since. WTI’s price followed a similar pattern, peaking at around $76 a barrel in October and dropping to $42 on Dec. 23.
SPRING BREAK JUMPS
Hack said Flagstaff’s prices themselves fluctuate as the travel season picks up, with drivers needing more gasoline during holidays and summer vacations. Additionally, Flagstaff stations typically adjust prices based on their two- or three-mile radius in town.
“Obviously we are not going to go exceptionally beyond any of the national averages or anything like that,” Hack said. “To stay competitive within a super local market, we will keep those prices within that few mile radius.”
Flagstaff appears to have a history of gas hikes around the same time of year. While 2019 saw a jump of 5.2 cents between March 17 and March 19, 2018 included a similar move from $2.464 on March 13 to $2.512 just two days later, an increase of 4.8 cents.
While prices overall were lower, 2017 also saw a similar jump in mid-March, as the price moved from $2.380 on March 14 to $2.459 on March 16 (7.9 cents) and from $1.916 on March 15, 2016 to $2.004 on March 17, 2016 (8.8 cents).
The jumps all came days within spring break for both Northern Arizona University and Flagstaff Unified School District, as well as the St. Patrick’s Day holiday.
“The easiest way to hit consumers is during the summertime when people are out and about,” Hack said. “You’ll typically see it when car traffic goes up for travel in the United States during the nice months, May to October, April to October.”
The current rises likely won’t slow down any time soon, as the price peaked in July in three of the past four years. Additionally, OPEC’s production cuts were announced to continue for an initial period of six months, with the organization set to meet again on June 25-26.
“Even if they have kicked up production, you may not see any changes in price,” Hack said. “Honestly, any gas price you see posted up on a board anywhere is probably what the price was six months ago.”
Last summer led to a high price of $3.130 on July 1, the highest average total for a day in 2018 and the highest price for a gallon in Flagstaff’s metro area dating back to November 2014.
In 2016, the annual high topped out at $2.430 on July 3 and 2015’s high came on July 22 at $3.011. The lone recent annual high outside of July came in 2017, when Nov. 25’s price of $2.600 came two days after Thanksgiving.
“We will remain competitive, that's all I am going to say,” Hack said. “I believe that our price will probably rise somewhat in the next several weeks. I can't say to what, but I believe that we will remain competitive with the rest of the people in our region.”