“Cheaper gas prices” probably wasn’t tops on many holiday wish lists. But relief at the pump could represent a holiday dream come true: As families save money on gas, the budget will be freed up to purchase more presents.
It has been quite an up-and-down year for gas prices—mostly up, considering that 2012 will go down as the most expensive year ever for gasoline. But as the calendar comes to a close, drivers are finally seeing some relief, with the combination of ample supply and low seasonal demand resulting in prices at the pump that haven’t been seen in years in some parts of the country.
“We’ve gone from an industry that was worried about enough gas to one wondering how it will deal with all of this gas,” Tom Kloza, of the Oil Price Information Service, told USA Today. “And we haven’t seen the bottom yet.”
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The experts at GasBuddy noted that drivers states such as Oregon, Minnesota, Alaska, and Hawaii are now paying less than they were a year ago at this time—folks in Alaska, where the average is $3.72, are paying nearly 50¢ per gallon less than they were 12 months prior:
“The national average has continued to see a steady decline over the last week, and that trend will likely continue through this week at the very least,” said GasBuddy.com Senior Petroleum Analyst Patrick DeHaan. “Last week, the Energy Information Administration reported one of the largest single week increases in gasoline inventories in my recent memory, which will likely contribute downward pressure to wholesale gasoline prices in the days and perhaps weeks ahead.”
According to the AAA Fuel Gauge Report, the national average for a gallon of regular now sits at about $3.33, down 10¢ from a month ago—though still about 5¢ higher than the national average from a year ago at this time. Considering the surplus in gasoline inventories and relatively low demand, experts are predicting a continued drop in gas prices, with the national average hitting perhaps $3.20 by Christmas.
Prices are expected to dip much lower than that in certain parts of the country. In states such as Oklahoma, Tennessee, Texas, Missouri, South Carolina, and Arkansas, the average is already under $3.15. The prospect of $3 gas is very much within reach in places states like Missouri, where gas prices have dropped 40¢ over the last two months, and the current average is just $3.03.
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Gas prices below $3 are already being reported in parts of Mississippi, where the statewide average measures $3.13. Drivers in Wisconsin, meanwhile, are getting ready for the possibility soon of a statewide average under $3, a threshold that hasn’t been dipped under in two years.
It’s very unlikely that California will see $3 gas anytime soon, but everything’s relative: The statewide average of $3.62 may be well above the national average, but it’s over $1 cheaper than what drivers in the Golden State were paying as recently as October.