Average Kansas per gallon price falls four cents to $2.30

TOPEKA – Gas prices in Kansas have fallen to their lowest level since Hurricane Harvey made landfall in Texas in late August. Kansas’ $2.30 average pump price this week is four cents lower than a week ago and down 19 cents per gallon from the $2.49 registered on Sept. 5, 2017. This is the fifth consecutive Monday with a lower average gas price in the Sunflower State.

“Now that we are clear of and recovered from the storm-related impact of oil production operations, we’re really seeing our normal autumn seasonal decline in gas prices across Kansas and the country,” said AAA Kansas spokesperson Jennifer Haugh. “Once summer vacation season is over, gasoline demand and price typically decreases. That, coupled with the less expensive winter-blend gasolines being introduced into the market, and motorists are seeing very favorable prices at the pump.”

According to AAA Kansas, this week’s Kansas gas price extremes are:
HIGH: St. Francis (Cheyenne County) – $2.70
LOW: Burrton (Harvey County) and Haven (Reno County) – $2.11

AAA Kansas reports that Wichita, with $2.26/gallon pump prices ranks as the 24th lowest metro area in the nation, while Topeka ($2.28/gallon) ranks 33rd lowest. Of the 10 Kansas cities regularly highlighted by AAA Kansas (see chart below), Salina (-7 cents), Kansas City, Kan. (-6) and Topeka (-6) saw the largest price decreases, while prices in Manhattan (+2) and Hays (+1) actually rose slightly.

National Perspective
Motorists are paying on average six cents less for a gallon of gasoline on the week with all states seeing prices at the pump either drop or hold steady. Today’s national gas price average is $2.49, which is 18 cents cheaper than a month ago. With the latest Energy Information Administration (EIA) report measuring gasoline demand at 9.2 million b/d, down 281,000 b/d from the week prior, retail gas prices are showing steady promise of returning to pre-hurricane rates.

“Across the country, gas prices have fallen steadily for the past four weeks and now we are seeing gasoline demand drop alongside prices,” said AAA Kansas’ Haugh. “The latest demand figures show the lowest since the week Hurricane Harvey hit and can likely be the beginning of a downward demand trend indicating even cheaper gas prices to come this fall.”

Over the weekend, Hurricane Nate made landfall over the Gulf Coast and is now a tropical depression. Ahead of the storm, many Gulf Coast oil platforms and rigs were shut down and employees evacuated. In addition, two refineries, accounting for six percent of total Gulf Coast refining capacity, shut down. Early reports speculate that refineries did not sustain damage and operations could start up today, Monday. Overall, motorists will see minimal to no impact to gas prices in the region hit by the storm.

Great Lakes and Central States Report
At 10 cents less than last week, Michigan ($2.40) is the region’s one state to see the largest and only double-digit drop in gas prices on the week. All states are paying less on the week. Following closely behind Michigan are Indiana (-9 cents) and Ohio (-9 cents). With a two-cent decrease, North Dakota saw the region’s smallest decline.

The region’s pump price drop comes alongside a large 1.5 million bbl drop in the Great Lakes and Central states overall gasoline inventory. According to the EIA, this was the largest inventory drop of all regions in the country. At 50 million bbl, total levels are on par with inventory last year at this time.

By JOHN P. TRETBAR

The Kansas Corporation Commission reports 140 new intent-to-drill notices filed across the state in September. The year-to-date and third-quarter total is 1,177. That’s still higher than the 838 intents filed through the third quarter of last year, but well below previous years. Through September of 2015, operators had filed 1,862 intents. Barton County lists three new intent-to-drill notices filed last month, while Ellis County had six. There was one new intent filed in Russell County and six in Stafford County.

Baker Hughes reports 939 active drilling rigs across the US over the last week, down two oil rigs and two gas rigs. In Canada there were 209 active drilling rigs, down four. Independent Oil & Gas Service reports fourteen active rigs in eastern Kansas, up four, and 25 west of Wichita, up one. They report drilling ahead at one site in Russell County and one in Stafford County, along with another site in Stafford County where they’re moving in completion tools.

Independent Oil & Gas Service reported 38 new well-completions over the last week, bringing the year-to-date total to 990. There were 16 completions in eastern Kansas and 22 west of Wichita, including three in Ellis County and four in Stafford County.

Operators filed 40 permits for drilling in new locations last week. That’s 1,093 so far this year. There were 21 east of Wichita and 19 in western Kansas, including one in Ellis County and one in Russell County.

Oil production platforms in the Gulf of Mexico began returning to service Monday after Hurricane Nate forced the shutdown of more than 90 percent of the crude output in the area.

The spread between WTI and London Brent is credited with a huge increase in domestic crude exports, 1.98 million barrels a day, according to the Energy Information Administration. Rising U.S. production has held down WTI prices, while Brent’s price is heavily influenced by policy directions from OPEC.

OPEC is due to meet in Vienna on Nov. 30, when it will discuss its pact to reduce output in order to prop up the market. The Secretary-General says consultations are underway for an extension of their production agreement beyond March, saying more producers may join that pact in November.

A Bloomberg News survey of analysts, oil companies and ship-tracking data on Monday found that OPEC as a whole added 120,000 barrels a day in September, led by increases from the Saudi kingdom, Kuwait, Libya and Nigeria. Meanwhile, higher prices spurred new US exploration, which generated some downward pressure.

Alaska residents won’t get as much as expected, but each of them woke up $1,100 richer Thursday, thanks to the state’s oil wealth investment fund. Alaskans have gotten used to receiving double that amount, but for the second straight year, the payout was reduced to help the state pay its bills amid a recession due to continued low oil prices.

The company building the Keystone Pipeline system has scrapped plans for another system to move oil and gas from Alberta, Canada to the east coast. TransCanada noted what it called “changed circumstances” and said they would no longer proceed with the $15.7 billion Energy East pipeline and another natural gas pipe. The projects faced regulatory hurdles in Canada and stiff opposition from environmentalists. Bloomberg reports the move will force TransCanada to record an $801 million after tax charge in the fourth quarter.

An energy company is seeking federal approval to build a pipeline in eastern Montana that would transport carbon dioxide for use in enhanced oil production along the North Dakota border. Denbury Resources, based in Plano, Texas, specializes in using carbon dioxide for oil recovery with projects completed or pending in Texas, Alabama, Wyoming, Mississippi and Louisiana. The company has not released a construction timeline or specifics on the volume of carbon dioxide that would be transported.

A North Dakota jury last week returned guilty verdicts against an environmental activist who targeted an oil pipeline a year ago. The panel found Michael Foster of Seattle guilty of conspiracy to commit criminal mischief, criminal mischief and trespass. Foster was acquitted of reckless endangerment. Foster did not deny using a bolt cutter to get through a chain link fence so he could turn the pipeline’s shut-off valve. He contended his law-breaking was in the public’s interest. A co-defendant who filmed the protest was found guilty of conspiracy. Both are scheduled for sentencing in January.

Canada’s minister of natural resources tells The Canadian Press that transporting oil by pipeline is a better choice than rail cars. The federal government’s approval of the Trans Mountain pipeline is under a legal microscope as opponents argue the process was incomplete and failed to take into account the impact the pipeline could have on everything from killer whales to waterways. Minister Jim Carr said getting more oil to the West Coast so it can be loaded on tankers and sold to China will be better for the country and getting it there on pipelines rather than rail cars is better for everyone.

If one thing has become clear in the week since the Kansas Supreme Court tossed out the newly minted school finance plan for K-12 public schools, it’s that Kansas politicians have become better at talking around the problem.

So far, it’s generally Democrats saying that the Legislature short-changed schools with the new finance plan.

Generally, Republicans are saying that the finance plan is OK, and that the Kansas Supreme Court is meddling and it ought to give the program a chance to produce the better outcomes (that’s smarter students) that the state wants.

And because the high court didn’t say just how much more money it wants spent on K-12 education, there is no real target for the Legislature to aim at as it figures out a new formula based on the court’s objections to how the plan distributes money to school districts.

Democrats are basically saying spend more money but aren’t saying where that money should come from. The answer, of course, is taxes, which the Legislature increased by nearly $600 million last session; most Kansans are just now getting an idea of how much it is going to cost them.

Republicans don’t want to raise taxes again, no matter how laudable the use of that new money. They’re just saying, “No new taxes.”

So where does this Supreme Court order go?

The court objected to a handful of relatively narrow provisions in the new school finance bill. Things like adjusting state contributions toward local school boards’ Local Option Budget (locally approved property tax increases for schools) that the court said aren’t absolutely equal across the state. There is the provision that gives money to school districts for students who receive free- or reduced-price lunches under federal programs even if they don’t have at least 10 percent of pupils in that situation—a legislative hand-out to a couple Johnson County districts.

Oh, and there is that “please show your work” provision in the judgment, that the court couldn’t tell exactly what the Legislature based some of its decisions on in assembling the new school finance plan, and some relatively polite, but pointed objection to some of the research lawmakers used to produce facets of the bill that the court couldn’t double-check.

But the clearest view of the new decision is that with no dollar amount of new spending demanded by the court, well, nothing is clear.

What’s it going to come down to?

First, there will be largely Republican efforts to somehow toss aside the court decision. It’s the legislative and executive branches that are in charge of keeping the government working, they’ll maintain. Keep the courts out of it, and as long as we’re sending U.S. currency to school districts, well, that’s OK.

There will be Democratic efforts to churn through the decision, come up with the fixes the court wants, and then compute what those formula changes work out to in terms of tax dollars. It’s essentially determining the changes the court wants, putting them into state law, then either coming up with new money or redistributing available money through that reshaped formula to see what districts will get.

Then there’s the problem with a new formula—some districts getting less money under the new formula with no new money and figuring out how much new money is needed so that no district gets less next year than it did this year.

This isn’t going to be easy, won’t be pretty…and at the end of the exercise, House members who stand for re-election in 2018 will be telling their districts they did the right thing. Wonder how that’s going to be phrased…

Syndicated by Hawver News Company LLC of Topeka; Martin Hawver is publisher of Hawver’s Capitol Report—to learn more about this nonpartisan statewide political news service, visit the website at www.hawvernews.com