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US Gasoline Hits Highest Memorial Day Level Since 2022 on Supply Shocks, EIA Says

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US gasoline prices climbed to the highest level for the Memorial Day holiday since 2022 as the de facto closure of the Strait of Hormuz drove up crude prices and tightened global fuel supplies, the Energy Information Administration said on Friday.

The EIA said the national average price for regular gasoline reached $4.49 per gallon on May 18, up 42% from a year earlier and marking the highest level for the Monday before Memorial Day weekend since Russia's invasion of Ukraine disrupted oil markets three years ago.

Rising crude prices, which typically account for about half of retail gasoline costs, have been the biggest driver behind the increase since February.

The agency said global crude markets have been rattled by supply disruptions linked to the effective closure of the Strait of Hormuz, a key chokepoint for oil shipments.

Regional factors, including refinery outages, fuel specifications, and taxes, are also amplifying price disparities across the country.

The Midwest and Rocky Mountain regions posted some of the steepest increases after refinery maintenance and outages constrained fuel supplies. Midwest gasoline prices averaged $4.40/gal on May 18, up 45% from a year earlier, while Rocky Mountain prices rose 47% to $4.59/gal.

The EIA said several large refineries in the Midwest have been affected in recent weeks, including Phillips 66's (PSX) Wood River refinery in Illinois and Marathon Petroleum's (MPC) Robinson refinery, both of which were undergoing maintenance.

BP's (BP) Whiting refinery in Indiana also experienced a temporary outage following a power disruption. Suncor Energy's (SU) Commerce City refinery in Colorado suffered an unplanned shutdown after a power outage during maintenance work.

On the West Coast, where gasoline prices are typically the nation's highest because of stricter fuel standards, limited pipeline connectivity and higher state taxes, prices averaged $5.61/gal, up 31% from a year earlier.

California's unique fuel specifications, which make gasoline more expensive to produce, have continued to weigh on the region, according to the EIA. Imports into the West Coast have also risen as refining capacity in the region declines.

The Gulf Coast retained the country's cheapest gasoline prices, averaging $3.95/gal, benefiting from its concentration of refining capacity and relatively low fuel taxes. The East Coast, the nation's largest gasoline-consuming region, averaged $4.31/gal.

The EIA said the US has rolled out several emergency measures to ease fuel market pressures.

The government is releasing crude from the Strategic Petroleum Reserve in coordination with the International Energy Agency, temporarily allowing nationwide sales of E15 gasoline and issuing waivers under the Jones Act to facilitate fuel shipments between US ports.

Federal regulators have also relaxed enforcement of summer-grade gasoline standards. Despite the higher prices, holiday travel demand remains resilient.

The American Automobile Association estimates 39.1 million Americans will travel by car over the Memorial Day weekend, in line with last year.

Price: $67.65, Change: $-0.08, Percent Change: -0.12%

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