Michigan gas prices down, but expected to go higher this summer

Michigan's average gas prices came down 8 cents Monday to $3.53 a gallon, but, could go higher after news from Saudi Arabia this weekend that it is cutting how much oil it sends to the global economy to boost the sagging price of crude and will "do whatever is necessary" to stabilize the market.

Michigan drivers are still paying 10 cents morethan this time last month, but still $1.49 less than this time last year, according to AAA, which tracks prices nationwide. Nationally, the average price is $3.55 a gallon for regular unleaded gasoline.

Oil demand decreased from 9.43 to 9.1 million barrels a day. Lower demand has helped to cap increases in pump prices. Meanwhile, total domestic gasoline stocks dropped slightly to 216.1 million barrels, according to the Energy Information Administration.

More:Alex Palou wins 2023 Detroit Grand Prix in return to downtown

More:Wildfire near Grayling 85% contained; source was campfire on private property

West Texas Intermediate — a crude oil that serves as one of the main global oil benchmarks — decreased by $1.37 to settle at $68.09. Oil prices fell amid a strengthening dollar and growing market concern that global energy demand could slow due to reduced manufacturing activity in China — the world's top crude oil importer, AAA said.

At the same time, the Associated Press reported Sunday that Saudi Arabia's new cut would "likely push up oil prices in the short term, but the impact after that would depend on whether Saudi Arabia decides to extend it," according to Jorge Leon, a senior vice president of oil markets research at Rystad Energy.

"Gas is not going to become cheaper," Leon said. "If anything, it will become marginally more expensive."

Contact Frank Witsil: 313-222-5022 or [email protected].