In a welcome development for American motorists, gas prices are experiencing a significant decline trend across the US, with 11 states now boasting averages below $3 per gallon. According to data from the American Automobile Association (AAA), states in close proximity to the Gulf Coast’s oil production and refineries are enjoying the lowest average prices, ranging between $2.80 and $2.99 per gallon. These states include Alabama, Arkansas, Georgia, Kentucky, Louisiana, Mississippi, Missouri, Oklahoma, South Carolina, Tennessee, and Texas.
The consistent decline in gasoline prices can be attributed to several factors. First and foremost, the seasonal drop in demand, coupled with the utilization of less expensive winter-grade gas, has contributed to the cost relief. Additionally, states located nearer to oil production and refineries generally benefit from lower excise taxes on gasoline and reduced distribution costs, further driving down prices at the pump.
As of now, the national average for gasoline stands at $3.36 per gallon, showcasing a notable decrease from the $3.78 recorded one year ago. Notably, California, known for its traditionally high gasoline prices, has seen a welcome dip to $5.07 per gallon, marking a $0.60 reduction from just one month ago.
Looking ahead, gasoline consumption in the United States is anticipated to decrease in the coming year. Factors influencing this projection include the sustained trend of remote work among Americans, improvements in fuel efficiency, and the persistence of high inflation. The Energy Information Administration suggests that with inflation impacting consumer budgets, discretionary driving has started to wane, leading to a further reduction in demand.
Despite the volatility in the oil market, gasoline prices have managed to decline even as West Texas Intermediate and Brent crude prices hover above $77 and $82 per barrel, respectively. Patrick De Haan, the head of petroleum analysis at GasBuddy, notes that this downward trend in gasoline prices has persisted amid oil market fluctuations. In fact, drivers are currently experiencing prices at the pump that haven’t been seen since 2013.
Experts predict that motorists will continue to see relief at the pump throughout the remainder of the year, as long as there are no unexpected spikes in oil prices and no major refinery outages on the West Coast. The hope is that this downward trend in gasoline prices will endure, providing financial respite for consumers, as demand remains low and oil prices remain stable. Despite the challenges posed by an increasingly volatile oil market, the steady decline in gas prices in US since September offers a glimmer of optimism for drivers nationwide.
Source: Yahoo Finance
