Gas prices highest in more than 4 years
Chattanooga motorists are paying the highest prices at the pump in seven years for this time of the year as travel grows but oil supplies remain restricted by OPEC.
The average price of regular gas in Chattanooga jumped last week by 8.1 cents a gallon to $2.66 per gallon — the highest price for regular gas since January 2017 and the highest fuel price for mid April since 2014, according to GasBuddy’s daily survey of 170 stations in Chattanooga.
Gas prices in Chattanooga are 5.4 cents per gallon higher than a month ago and stand $1.16 per gallon above where they were a year ago when the pandemic had shut down most travel. Over the past year, and especially in recent weeks, travel has rebounded as the economy has reopened for business.
Last week, the International Energy Agency
revised its global oil demand growth forecasts upward or 2021 to 5.7 million barrels per day.
“Fundamentals look decidedly stronger,” the IEA said in its monthly report. “The massive overhang in global oil inventories that built up during last year’s COVID-19 demand shock is being worked off, vaccine campaigns are gathering pace and the global economy appears to be on a better footing.”
Chattanooga fuel prices remain 19 cents a gallon below the U.S. average, according to GasBuddy. com. But in the past week, national fuel prices have remained more stable than in Chattanooga.
In parts of the country, travel fell last week as cases of coronavirus spiked up again and spring breaks ended.
“Gasoline demand has given up ground for the second straight week, likely due to some areas seeing a rise in coronavirus cases, and as spring break plans conclude.,” said Patrick De Haan, head of petroleum analysis for GasBuddy. “The next trend in gas prices isn’t evident just yet, we may see additional slight sideways moves in the weeks ahead, until either demand starts to increase notably again, or we see the opposite.”
In contrast to the rise in Chattanooga gas prices for motorists, energy prices will be cheaper at home next month, although electricity prices are still up from a year ago in Chattanooga. Next month, the Tennessee Valley Authority will lower its wholesale rates from April’s level due to a drop in TVA’s monthly fuel cost adjustment. The fuel cost portion of electric bills jumped this month from March’s level by the biggest amount since TVA created its monthly fuel adjustment
Beginning with bills on May 1, EPB will cut the average price of its power by nearly 3% from the current rate, dropping what a typical residential homeowner using 1,295 kilowatthours of electricity would pay from $145.18 this month to $140.94 next month.
EPB power bills for such a customer will still 3.1% higher in May than a year ago when the typical monthly bill was only $136.70, according to EPB.
TVA adjusts the fuel portion of its electric rates each month to reflect the costs of fuel used to generate its power. Additional rainfall helped produce more power at TV’s 29 power-generating dams, which are TVA’s cheapest source of power and have no fuel expenses.
“The overall system average fuel rate for May is nearly unchanged from the three-year average for May,” TVA spokesman Scott Brooks said. “Higher than normal rainfall and runoff in March allowed TVA to generate more electricity with our hydro plants than expected, which helped offset actual fuel expenses.”