Gas Prices Headed Below $2 a Gallon

Print Email

A gallon of regular gasoline costs $2.44 on average in the United States on Thursday, nearly a full dollar less than a year ago, and it is the lowest gas price going into the Labor Day holiday weekend since 2004. August gas prices averaged $2.60 a gallon, the lowest August average since 2005, and about 15 cents a gallon below the July 2015 price.

Once the summer driving season ends, U.S. drivers could be in for an even bigger treat: an average gas price below $2 a gallon. AAA spokesman Avery Ash said:

Gas prices in many parts of the country could fall below $2 per gallon by Christmas if the cost of crude oil remains low. There is good reason to believe that cheaper oil costs, a seasonal decline in driving and the switchover to less costly winter-blend gasoline will continue to push down prices through the end of the year.

U.S. motorists should save more than $1 billion on gasoline over the holiday weekend compared to 2014, with many drivers saving about $15 to $25 on every trip to the gas station, according to AAA. Ash also noted:

Americans should find good deals on gas prices in most parts of the country heading into the busy Labor Day weekend. It is unbelievable that drivers are ending their summer vacations with the lowest gas prices for this time of year in more than a decade.

Gas prices are about 41 cents a gallon higher than they were in January, when crude oil cost about the same as Wednesday’s closing price of $46.25 a barrel. Refinery issues and higher-cost summer blend gasoline have kept the price higher than might be expected. AAA notes that gas prices generally rise or fall about 2.4 cents per gallon for every $1 change in the per-barrel price of crude oil.

According to AAA, historically when crude oil prices stay below $40 a barrel for an extended time, price of gasoline falls below $2 a gallon. The average gas price in South Carolina is already $2.00 a gallon.

ALSO READ: Does Lifting the US Ban on Oil Exports Really Make a Difference?