Gas prices at some Dodge City gasoline stations jumped up 10 cents a gallon, despite the state average being $2.15 a gallon.
The increase in price at the pump is due to a rise in oil prices on Monday triggered by Saudi Arabia — a key member of the Organization of the the Petroleum Exporting Countries — and non-OPEC member Russia both supporting the oil production slowdown for another 9 months, to end of March 2018.
Kuwait agreed with them on Tuesday, but the oil rally slowed. According to CNBC, analysts had warned the oil market is vulnerable to profit taking after crude features rapidly retraced big losses in recent weeks.
Saudi Arabia and Russia are prepared to continue the 1.8 million barrels per day slowdown in an attempt to reset supplies of crude available. Kuwait's oil minister, Essam al-Marzouq, said on Tuesday he supported the Saudi/Russian initiative. Other OPEC states are expected to back the move at a meeting on May 25.
"Rebalancing is essentially here and, in the short term at least, is accelerating," the International Energy Agency said in its monthly report on Tuesday.
There is no final deal yet despite the pledge by Saudi Arabia and Russia. The 12 remaining OPEC members and other producers participating in the cuts have to agree to the extension during a meeting on May 25.
"It remains to be seen whether all countries participating in the deal will agree with the Saudi-Russian stance," said Sukrit Vijayakar, director of energy consultancy Trifecta, in CNBC’s report.
James Woods, investment analyst at Australia’s Rivkin Securities told CNBC that oil supplies would likely remain plentiful despite an extended cut.
"As we have seen over the past six months, rising US production and record inventories have kept upside limited and a 9-month extension at this stage is unlikely to break that."
According to AAA Kansas, OPEC is expected to draft a formalized production cut extension during its meeting in Vienna, Austria, on May 25. However, there is skepticism that any extended cuts will offset growing U.S. production. Last week, U.S. drillers added an additional nine oil rigs, bringing the total US rig count to 712 and marking 17 weeks of growth. The expected result of OPEC’s actions is far from certain. Until it is, drivers may continue to benefit at the pump — even during the typically more expensive summer driving season.
"The national average gas price has again declined in the last week, but the road ahead may be a bit bumpier," said Patrick DeHaan, senior petroleum analyst for GasBuddy.com. "While the national average fell, several states in the Great Lakes saw average prices rise thanks to a mid-week rally in oil markets that saw oil prices sneak in a net gain for the first week in several, and that may impact prices in the week ahead.
"Thank Wednesday’s weekly report from the Energy Information Administration for the rally as government data showed a larger than expected decline in oil inventories and gasoline inventories, weighing on markets at the precise time that OPEC chats about extending its crude oil production cuts. Watch both of these factors this week to get a taste for where prices will go to start the summer driving season."
According to GasBuddy.com, the cheapest gas in Kansas is a Sunshine station in Coffeyville, where a gallon of regular unleaded is $1.79 a gallon. A 24/7 Travel Store in Salina is next at $1.92 a gallon with a variety of stations in Coffeyville, Pratt and Salina at $1.95.
A Cenex station in Deerfield is the state’s highest-priced gasoline, selling it for $2.44 a gallon.
In Dodge City, all three Love’s stations, as well as the Flying J and a Cenex station on south 14th Avenue are all listed at $2.19 a gallon. Love’s and Flying J were listed at $2.09 on Monday.
The lowest price in our area is at Presto on Trail Street near US 56-283. Presto is selling a gallon of regular unleaded at $2.08 a gallon.
Murphy USA, Dillons and Kwik Stops all stayed at $2.09 on Tuesday.
In area prices, Love’s in Meade is at $2.13 a gallon, while Hilker Oil in Cimarron is at $2.17. Bucklin Co-op is currently at $2.18, while the Presto in Montezuma is at $2.19 a gallon, as is a Cenex in Jetmore.
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