The nationwide average price of a gallon of gas has fallen 8 cents in the past week, now sitting at $3.84, according to AAA. The Biden administration has announced plans to release millions of additional barrels of oil from the Strategic Petroleum Reserve this winter, anyway.
Georgians are paying the lowest prices in the nation today, at $3.24 per gallon. California residents see the highest pump prices — $5.88.
Prices briefly flirted with $4 per gallon early this month as the nation’s supply took several hits. A refinery fire in Ohio and seasonal maintenance at some processing centers combined to lower the nationwide stock of gasoline. Then the OPEC+ consortium of oil-exporting countries voted to slow oil production.
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Prices Already on the Way Down
Those factors together drove a brief October price spike. But prices are falling again.
Patrick De Haan, head of petroleum analysis for GasBuddy, says further drops are on the way:
Good news on #gasprices: here's my new prediction on #gasprices over the next couple of weeks… lots of green down arrows. West Coast and Great Lakes will continue to see the most relief, while others see slight downward trends- for now. pic.twitter.com/1dsqsvjLRU
— Patrick De Haan ⛽️📊 (@GasBuddyGuy) October 20, 2022
That has also come thanks to a combination of factors.
Lower Demand, Recession Fears
The largest one? We’re driving less.
The U.S. Energy Information Administration reports that Americans used 8.7 million gallons of gasoline last week. That represents a significant drop in our driving. In the same week last year, we used 9.6 million.
But worries about the state of the global economy are also a factor. AAA explains, “Fears of a global economic recession led to a major drop in the price of crude, down $7, which helped to minimize pump price increases last week.”
Prices remain historically high — 48 cents higher than a year ago.
Release Amounts to Less Than 1 Day’s Supply
That may help explain the White House’s decision to release an additional 15 million barrels of oil from the strategic reserve in December.
The reserve can hold about 700 million barrels of oil. It has about 400 million remaining, the White House says.
The numbers can sound massive. But, to put them in perspective, America uses just over 20 million barrels per day, according to the Department of Energy. About 40% of that total goes to cars.
So, the administration’s release, while significant, amounts to less than a day’s supply, stretched out over the course of a month.
