In a welcome respite for drivers, gas prices have fallen below $3 per gallon, marking the lowest average since May 2021, according to recent data from GasBuddy. This decrease comes just in time for the busy Thanksgiving travel period, with some parts of Colorado even seeing prices dip below $2 per gallon.
As of Dec. 1, the average price nationally hovers around $2.95 per gallon, an 8.5-cent drop from the previous week and 5.4 cents lower than at this time last year. AAA reports slightly higher average prices at about $3 per gallon, still reflecting a notable reduction from the prior week.
This decline in gas prices is attributed to robust refinery output, declining crude oil prices, and a seasonal drop in fuel demand. The U.S. Energy Information Administration notes that domestic crude oil production has reached nearly 14 million barrels per day as of September, an all-time high contributing to the price decrease. Additionally, increased oil production by the Organization of the Petroleum Exporting Countries has also played a role, according to Patrick De Haan, head of petroleum analysis at GasBuddy. De Haan notes that the stabilization of the U.S. economy following the COVID-19 pandemic and the geopolitical tensions in Ukraine has also influenced this downward trend in fuel prices.
Although a psychological relief, these prices are part of normal seasonal fluctuations, where prices tend to be lower in winter and rise again in spring.
Gas prices have dropped in all 50 states, with significant declines noted in Ohio, Michigan, New Mexico, Oklahoma, and Texas. Notably, in states like Oklahoma, Colorado, and Texas, prices have fallen to $1.99 per gallon or lower.
Despite the drop in gasoline prices, the average price of diesel remains higher at $3.72 per gallon, albeit with a recent 5.5-cent decrease.
GasBuddy’s analysis is based on over 12 million price reports from more than 150,000 gas stations nationwide.
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