“National average fuel prices are nearing a 3-year low, falling to $2.96 a gallon as of Friday, according to AAA. The decline is led by a 24% drop in gas prices on the West Coast since the start of the year. #gasprices #fuel”
National Average Fuel Prices Nearing Three Year Low
No sooner did President Trump win the election in a landslide than national average gasoline prices are set to fall below the $3 per gallon mark heading into the holiday season in the U.S.
In fact, national average fuel prices have dropped to their lowest since January, nearing 2021 levels, with further declines likely as West Texas Intermediate crude hovers near its lowest since September, according to Yahoo Finance/Bloomberg.
The Yahoo Finance/Bloomberg article states that AAA predicts 71.7 million people will travel by car for Thanksgiving, the highest since before the pandemic. Gas prices, averaging $3.08 last week, could drop below $3 nationally, with drivers in some states east of the Rockies paying as little as $2.25 to $2.50 per gallon.
Patrick DeHaan, head of petroleum analysis at fuel tracker GasBuddy, told Yahoo/Bloomberg: “Things at the pump are starting to feel normal for most Americans.”
He added: “In some parts of the deep South, where gasoline taxes are low, we’re seeing gas prices that would be more equivalent of the nostalgia everyone has for the good times.”
“Refineries are struggling under weak crack spreads already, meaning that gasoline demand is anemic, and they’re having a hard time finding a home for all the gasoline they’re producing,” DeHaan concluded.
Meanwhile Yahoo/Bloomberg notes gasoline demand rebounded above last year’s levels, with nationwide inventories dropping and U.S. refiners producing record amounts to counter a decline in imports. However, the brief Thanksgiving travel surge is unlikely to significantly boost refiners’ margins.
Traffic congestion, unlike gas prices, will soar, with cities like Boston, New York, and Los Angeles experiencing more than double their usual traffic, according to INRIX.
And international travel is booming, with flight bookings up 23% and cruise bookings rising 20% compared to last year. Air travelers are also benefiting from lower costs, with international flight prices down 5%, according to AAA.
While the decline hasn’t been attributable to President Trump’s re-election just yet, Zero Hedge contributor Quoth the Raven predicted in a note on Monday morning column that Trump in office likely means less geopolitical volatility, and eventually, a continued tailwind for lower gas prices.