Watch for a mixture of good news and bad news in the upcoming April Consumer Price Index. The bad news will come via a considerable rise in the CPI thanks to a brisk rally in gasoline and diesel costs this month. The good news, according to GasBuddy analysis, is that April may reflect lofty numbers that will give way to attrition ahead of the summer driving season.
Background: The Bureau of Labor Statistics March Consumer Price Index highlighted cheaper energy costs as a key factor that contributed to a modest March gain in the index, since gasoline prices dropped from the February survey. The extensive GasBuddy.com database indeed confirms that gas prices did drift lower in March, but a running count of April numbers points to a substantial seasonal spike in the consumer data for April.
With less than a week left in April, the national monthly average for unleaded regular has increased more than 12cts gal from March’s average to $3.632 gal, and some additional gains are anticipated as “summer blend” gasoline replaces cheaper winter grades. So while the energy index contributed to a lower March CPI, the increase of 3.4% in April will most likely raise the CPI when the Bureau of Labor Statistics publishes its April CPI next month.
There are, however, some exceptions to the uptrend in a few pockets of the country. States such as Colorado have seen April gasoline prices trend modestly lower when compared to March levels. Colorado, Utah, Alaska, and Minnesota represent the only four states with month-to-date gasoline averages lower than March numbers, with Colorado particularly weak. The county of Fremont, Colorado is enjoying an average 2.9% lower than March, with a 10ct decrease, the largest county decrease in the US. Higher refinery runs and brisk North American crude production gains have tempered prices in portions of the Rockies, GasBuddy analysts add.
On the opposite end of the spectrum, some Southeastern and Middle Atlantic markets have seen dramatic increases in April fuel prices. Washington DC, Georgia and Alabama have already seen 20cts gal or more added to the price of gas this month, with local cities in some cases 30cts gal or more above last year’s prices. Counties in Georgia especially dominate: Baldwin, GA is 34cts higher this month than last, a 10.4% increase. Dougherty, GA isn’t far behind with an increase of 32cts, or 9.7%. The gains are tied to an especially ambitious amount of 2014 refinery maintenance at the Gulf Coast and also to a quieter import market.
Overall, GasBuddy.com expects the nation to be paying significantly more at the pump this April over March, affecting the consumer price index in the process.