Gasoline prices ended the year at $2 per gallon, the second lowest price in a decade. The benefit to consumers was huge. Their net savings on gas prices for the year was $115 billion.
Although the effects on gas prices were not entirely positive because of lost jobs and lost sales in the oil and gas industry, the typical benefit to the typical American is hard to underestimate. Mean annual household wages in the United States have been stagnant for a decade at about $52,000. Some Americans still live in areas where real estate prices have not entirely recovered from the bursting of the sector’s bubble prices.
Some of the benefits, according to the AAA, have not ended (as of January 1):
Today’s national average price of gas is $2 per gallon, which is the lowest average for New Year’s Eve since 2008. Today’s average is about 26 cents per gallon less than a year ago.
- The national average price of gas for December was $2.01 per gallon, which was the lowest monthly average since March 2009.
- Gas prices are lower than $2 per gallon in most parts of the country. About 71 percent of U.S. stations are selling gas for less than $2 per gallon today, and drivers can find at least one station selling gas for less than $2 in 47 states.
- The cheapest one percent of stations are selling gas for an average of $1.56 per gallon, and more than 16,000 stations across the country are selling gas for less than $1.75 per gallon.
Gas prices may fall even more in 2016:
Gas prices are likely to remain relatively low in 2016. AAA estimates the annual average price of gas in 2016 is likely to end up between $2.25 and $2.45 per gallon, which would be cheaper or at least comparable to this year’s average of $2.40 per gallon.
- Based on typical seasonal trends, the national average price of gas could remain relatively flat or drop another 10 cents per gallon over the next few weeks. By late winter, the national average could rise 50 cents per gallon or more as refineries conduct seasonal maintenance in advance of the busy summer driving season. Despite the likelihood of higher prices by spring, AAA does not expect the national average price of gas to rise above $3 per gallon in 2016.
Since gas prices are such a large portion of the household costs of many Americans, the potential benefits to U.S. gross domestic product in 2016 may be substantial.