Since last week, the price of gas fell in nearly every state compared to a week ago, dropping significantly in Ohio as the state joined a handful of others that have suspended taxes on fuel through the rest of the year to give motorists a break at the pump.
Michigan officials are debating whether to do something similar.
Gasoline prices, which averaged $4.46 a gallon on Monday, Oct. 5, in Michigan, were down 21 cents from a week ago, according to AAA, but fuel prices nationwide are still higher, in many places considerably, than before the United States launched airstrikes on Iran.
"For now, declines may continue in a majority of states," Patrick De Haan, the head of petroleum analysis at GasBuddy, said, adding there could be "an upward swing"
in fuel prices as a result of "price cycling," a pattern in which competing gas stations lower prices to attract customers until profit margins vanish and then raise them.
In Ohio, the tax measure put average gas prices in Ohio below $4 a gallon after reducing fuel taxes, 38.5 cents a gallon on gasoline, and 47 cents for diesel, to nearly nothing. Ohio said the state will use $725 million in reserve funds to cover the reduction.
The most expensive gas price averages in Michigan by community were in Ann Arbor, $4.54 a gallon; Jackson, $4.50; and metro Detroit, $4.50; while the least were in Flint, $4.28; Saginaw, $4.39; and Marquette, $4.41. Diesel was selling for $6.62 a gallon, down from an all-time high last month of $6.89.
More crude oil now appears to be flowing through the Strait of Hormuz, but refineries aren’t getting shipments through, and there is more uncertainty about what will happen in the Middle East as a third aircraft carrier, the USS Theodore Roosevelt, heads to the region.
In the Middle East, tensions also have expanded to Saudi Arabia and Yemen, which launched a new offensive against the Iranian-backed Houthi militia to take back the Bab al-Mandab Strait, which is another oil chokepoint. The Trump administration is reportedly weighing whether to launch a new salvo of strikes after the midterm elections next month.
In addition, a Colorado climate change case, which the U.S. Supreme Court is expected to weigh in on, is seeking damages from two oil companies and argues that the fossil fuels harmed the environment, leading to heat waves and wildfires.
If the case moves forward, it could open the door to more lawsuits.
Fuel prices surged in Michigan and other Great Lakes states in late September in response to both rising oil prices as well as geopolitical and regional refinery concerns, but have eased somewhat, offering motorists relief as midterm candidates raise the issue of affordability.
In Michigan, Gov. Gretchen Whitmer has called for a federal gas tax suspension — 18 cents on gas and 24 cents on diesel — but she has opposed a reduction of state gas taxes, which some lawmakers and candidates for office have been urging.
The Trump administration also is mulling whether to support a diesel export ban, which Republican politicians — including U.S. Senate candidate Mike Rogers — have called for in hopes of bringing fuel prices down, but some petroleum industry experts argue a ban will do the opposite.
Contact Frank Witsil: 313-222-5022 or fwitsil@freepress.com.
This article originally appeared on Detroit Free Press: Gas prices fall, especially in Ohio, which just suspended fuel taxes
