The average price of a gallon of gas has slipped under $4 in four states. The list includes Texas, which uses more gasoline than any other state, according to the U.S. Energy Information Administration (EIA). If the current trend holds, gas is poised to fall below $4 per gallon in four more states by the end of the day.
The nationwide average price of a gallon of gas this morning is $4.44, AAA says. It has fallen by $0.52 in one month.
National Average Could Follow Soon
Patrick DeHaan, head of petroleum analysis at GasBuddy, said Monday, “Barring major hurricanes, outages or unexpected disruptions, I forecast the national average to fall to $3.99/gal by mid-August.”
What’s driving the decline? Several factors are at play.
We’re Driving Less Even in Peak Driving Season
Global oil prices are down. A barrel of WTI crude oil – the benchmark price for the U.S. market – is trading at $95.91 this morning, down almost $15 in just two weeks. A decrease in the price of oil usually leads to a decrease in the price of gas about a week later.
But the biggest factor is simply that Americans are driving less.
According to the EIA, Americans used 8.72 million barrels of gasoline last week. That’s down 7% from last year’s numbers.
It’s nearly as low as mid-July 2020, when COVID-19-related travel restrictions caused millions of Americans to stay home. The price of gasoline has had a similar effect on our driving as to the early months of the COVID-19 pandemic.
Related: High Gas Prices Have Americans Search for More Efficient Cars. Dealers Are Low On Them
July is normally the peak of the summer driving season. But this year, we seem to have peaked in June.
Low Prices May Not Tempt Us to Vacation in This Heat
It’s still possible that gas station signs with figures under $4 will tempt more Americans to hit the road soon.
But forecasters are predicting a brutal nationwide heat wave in the coming days. Twenty-eight states have issued extreme heat warnings this week, stretching from California to New Hampshire. Few things clear the beaches and parks like triple-digit temperatures.
The heat may last a week in some places. The Washington Post reports, “While the heat dome looks to shift east a touch in the coming days, it doesn’t look to break down anytime soon, meaning there’s no immediate end in sight to the heat. In Oklahoma City, Tulsa, Dallas, Wichita Falls, Houston, Austin, and Little Rock, highs should remain around or above 100 degrees for at least the next week.”
That may keep Americans off the roads.
“So far, we’ve seen the national average drop for 34 straight days, with over 25,000 stations now back at $3.99 per gallon or less,” DeHaan says. “Thousands more stations will join this week. In addition, we will see several states fall back under an average of $4, the majority being in the south, but that could spread to more states in the weeks ahead.”
Related:
- What Rising Gas Prices Actually Cost You
- Gas Prices: How Hypermiling Saves You Money
- How to Get Better Fuel Economy in Your Existing Car
