Yearly Denver-area food prices rise, energy costs fall; more-expensive gasoline may be in the cards

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Food prices are more expensive in the Denver metro area than they were last year, but energy costs are down, according to the latest inflation report released from the U.S. Bureau of Labor Statistics (BLS) on Thursday.

From September 2023 throuth last month, food prices in the Denver-Aurora-Lakewood area rose 2.1%, driven by a 5.8% jump in the cost of eating out, as measured by the BLS's consumer price index for all urban consumers. Prices for food at home dropped 1.1%, led by a 5.2% fall in the index for meats, poultry, fish and eggs.

Meanwhile, the yearly index for energy prices fell 8.7%, led by lower prices for natural gas service.

The BLS did not list the percent drop for piped natural gas service from utilities. Separate US Energy Department data show that the price of natural gas delivered to residential consumers in Colorado in July was $15.71 per cubic foot, down 2.7% from $15.29 in July 2023.

According to Thursday’s BLS figures, a 12.2% yearly drop in the price of gasoline also contributed to the overall decline in the energy index.

On Friday, data from AAA showed that the average regular gasoline price in Denver was $3.258 per gallon, down 10.9% from $3.657 a year ago.

The decrease in gasoline prices reflects the drop in oil prices. Domestic crude oil futures have dropped 9% year-on-year amid concerns about Chinese and U.S. demand amid record-high oil production in the United States, the world’s biggest oil-producing nation.

However, escalating tensions in the Middle East have been nudging up oil prices recently, and that will likely translate into higher gasoline prices.

“While the national average dipped slightly in the last week, Iran’s attack on Israel has at least temporarily caused oil prices to surge to the highest level in months, which could cause the declines to cease for now and could lead to a rise in gas prices for many Americans,” Patrick De Haan, head of petroleum analysis at GasBuddy, said in a blog post on Monday.

“For now, motorists in most areas can expect to see more increases in gas prices primarily due to tensions in the Middle East, but I remain hopeful that a $2.99 national average remains possible this fall,” he said.

Additionally, the current hurricane season is a wild card in terms of potentially disrupting oil production and refining in the Gulf of Mexico, which could contribute to higher oil and gasoline prices.