
In a stunning turn of events, U.S. gasoline prices are on a downward spiral, promising a pleasant shock for holiday travelers.
Get ready to fuel up your tanks for less, as prices might even dip below the magical $3 mark before the year’s curtain falls.
Denton Cinquegrana, the chief oil analyst at the Oil Price Information Service (OPIS), a Dow Jones company, unveiled this delightful forecast.
“Falling gasoline prices will give people confidence that their fuel bill will be a nice surprise,” he said, especially for those cruising through the 23 states already flaunting averages below $3 per gallon.
With over half of U.S. fuel stations selling gas under $3, it’s a driver’s market out there!
The numbers don’t lie: As of Monday, the average national price for regular unleaded gasoline was a mere $3.153 a gallon, a noticeable dip from $3.242 just a week ago, as per AAA.
It’s a welcome relief from the soaring prices that have had drivers reeling for months.
What’s behind this unexpected boon?
AAA spokesperson Andrew Gross sheds light on the trend: crude oil prices often plummet nearly 30% from late September into early winter, with gasoline prices following suit.
This year, over half of U.S. fuel locations are selling gasoline at less than $3 a gallon, and Gross predicts the national average may even “dip that low” before year’s end.
A recent uptick in weekly domestic demand for gasoline, coupled with a significant increase in fuel supplies, has fueled this downward trend.
Data from the Energy Information Administration reveal a slight increase in gasoline product supplied – a proxy for demand – while weekly supplies surged by 5.4 million barrels.
But wait, there’s more! Futures prices for reformulated gasoline on the New York Mercantile Exchange have plummeted to their lowest in two years.
On Thursday, they settled at $2.0012 a gallon – the lowest since December 3, 2021, according to Dow Jones Market Data.
Brian Milne, an analyst at DTN, anticipates that these declines in reformulated gasoline prices will trickle down to retail prices within two weeks.
Seasonal factors, combined with lower crude-oil prices, have exacerbated this trend.
U.S. benchmark West Texas Intermediate crude futures settled at a surprisingly low $69.34 on Thursday on Nymex.
This drop in gas prices isn’t just good news for drivers’ wallets; it’s also boosting consumer sentiment.
The University of Michigan’s U.S. consumer sentiment index saw a significant uptick in early December, likely spurred by these lower gasoline prices.
With AAA expecting 115.2 million domestic travelers during the holiday season, the timing couldn’t be better.
Most of these travelers – 90%, or 103.6 million – plan to hit the roads.
However, don’t get too comfy with these prices.
Milne warns that we might see a 25 to 30 cents rise in the national average retail gas price in the first quarter, reaching around $3.40 to $3.45 a gallon.
So, drivers, start your engines and make the most of this rare opportunity.
The roads are calling, and for once, the gas prices are in your favor.
Buckle up for a joyous and budget-friendly holiday travel season.