Gas Prices Are About to Hit New Lows

By Halloween — and perhaps much sooner, if the federal shutdown dampens demand significantly — consumers are likely to see the cheapest gas prices so far this year

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A year ago, the post–Labor Day period was marked with rising prices at the pump thanks to a brutal hurricane season, among other factors. This year things are different, with prices remaining subdued even when concerns about strife in the Middle East dominate the news. According to this week’s Energy Information Administration report, the national average for a gallon of regular at the end of September was measured at $3.42, which is around 40¢ less than a year ago. The AAA Fuel Gauge Report indicates that gas prices dropped about 20¢ per gallon nationally in the past month. The gas experts at AAA indicate that the September dip was the largest seen since last October, and expect prices to keep inching lower in the weeks and months ahead.

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“Gas prices could drop another 25¢ to 30¢ per gallon to the cheapest averages of the year barring significant refinery problems or higher oil costs,” AAA spokesman Avery Ash said via press release. “Averages in as many as five to 10 states could drop below $3 per gallon, but there is a floor to how low the national average can go given the very high cost of crude oil.”

The analysts at GasBuddy are basically on the same page, issuing a forecast in mid-September for prices to drop 20¢ to 25¢ by Halloween.

As of Tuesday, the national average stood at $3.39, just 10¢ higher than the lowest price seen thus far in 2013: $3.29 per gallon, the average at the beginning of January. Last year, which was an anomaly because September prices were so high, October saw a 26¢-per-gallon dip in the national average; the decrease in October 2011 wasn’t quite as dramatic, with a 13¢ drop in the national average for gas prices. But a gas-price drop in October is fairly standard, and so long as nothing unusual causes current trends to change abruptly, drivers should be seeing new 2013 lows at the pump by the end of the month.

In fact, something unusual is happening that could cause gas prices to drop at a faster pace than normal for October and beyond. Among the many expected effects of the federal-government shutdown that began on Tuesday are a general slowdown in the economy and diminished demand for oil and gas. The price of oil futures sank to the lowest level in three months on the eve of the shutdown, and the longer the shutdown, the longer it is likely that oil futures — and subsequently, prices posted at gas stations — will keep heading south.

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“The economy will slow down, confidence will slide, and demand for crude will be hurt,” Evan Lucas, an analyst with IG, told the Associated Press on Monday. “There will be a real snowball effect if the partial shutdown goes ahead.” As we now know, the shutdown is proceeding ahead. Lower gas demand and lower gas prices are likely to come as a result, but the shutdown is also expected to hammer the economy in general, to the tune of $1 billion per week, by some estimates.

20 comments
MindyOu
MindyOu

I really spend a lot on gas during the past two years. I hope the gas price keep going down in the future. I love cheap gas!!

DerickBranson
DerickBranson

That's a real good news for me at least as i have to spend a lot of my money on gas. With the Government shutdown reaching its fifth day, the economic and financial woes will only increase. One of my friends who happens to be a economic political analyst has just informed me that he is apprehensive whether this gridlock will be over even by mid-October. So, after hearing this I was really down. But this news of low gas price is good for me and for many people who has to drive long distances everyday.

pbug56
pbug56

So gas prices will set a new low?  IOTW, what, a nickel a gallon?  That is one of the most stupid things I've ever read from Time - maybe the author needs a little training in basic facts.

ckincaid_du
ckincaid_du

Excuse me, I'm a conservative, I vote Republican, and I'm not a terrorist. I'm glad the government shut down, so the Dems, who are the ones guilty of actual treason, will get to own the mess they made. The Republicans offered a sensible compromise, and Dirty Harry killed it. The economy isn't going to suffer from the shutdown. It's saving taxpayer dollars. The liberals would have you believe it's going to hurt, so you'll side with them.

dustie
dustie

Are people even considering the fact that gas comes from oil which is a LIMITED natural resource? All I see, hear, read is just people - especially in the US - shouting for more and cheaper gas... do you guys even think about where does it come from? How about cutting down the gas consumption once in a while, huh?

NAVASTOCK
NAVASTOCK

The OPEC's will slow production so that they can get their pound of flesh from the consumer. They will not sit there and go oh well.

Mr.Wallingford
Mr.Wallingford

Something tells me there are going to be a few "unscheduled" shutdowns of refineries in the weeks to come.

rjsigmund
rjsigmund

what they gonna make the gas out of, water?  5 days ago, oil prices were never higher for the last week of September...

bluelinegraphicdesign
bluelinegraphicdesign

good. Stay home loosers in congress...like Ralphie May says....I want cheap gas

Jonsinny
Jonsinny

All they need is some Arab in Giza to blow his nose and the oil prices will go up again.

DavidGinsberg
DavidGinsberg

Gas prices coming down are a result of declining economy, and nor for a good reason. House Republicans are guilty of treason. Watching them lie on CNN makes me vomit. I was once a Republican. I would sooner become a communist then see these extremist terrorists get their way. Yes, I said "terrorists."


Obamacare was necessary and will be good for USA, but that is not the issue. Obamacare is a done deal and reflected the will of the people of America. What would they say and do if the Senate passed a budget bill attached to a bill regulating purchases, use, and possession of guns?

It has nothing to do with budget. It is time to vote these extremists out of office. DO SOMETHING!! Write Congress, give money to Democrats, and vote Democratic across the board. House Republicans (and the remaining complicit congressional Republicans) represent nothing but their own selfish self interests and the wishes of extreme crazies who do not believe in government, separation of church and state, helping those in need, etc. 

People will suffer and die as a result if their actions, and the entire fabric of who and what we are as America is more degraded by their actions then by anything Bin Laden ever did.

Alvord1430
Alvord1430

Haven't used gasoline much for 3 years.  All my cars run on CNG and electric.  Only 20-50% the cost of gasoline.

cykociv
cykociv

Well then, keep it shut down. 

TommyFerrugia
TommyFerrugia

@ckincaid_du :

You consider a deal that would have defunded President Obama's signature piece of legislation, and killed a health care system that is so threatening to for-profit HMOs that they spent millions in an effort to kill it, a 'sensible compromise?'  LOLOL I wonder how many deluded right-wing whackos are going to look themselves in the mirror at the end of President Obama's tenure and say, 'Wow, not a single one of the totally ludicrous things the GOP said would happen under this administration has come true; I haven't lost a single freedom, my taxes haven't gone up, I can still buy as many guns as I want to in order to compensate for my tiny penis and the deficit's been dramatically reduced.  MAYBE I shouldn't just be a zombie and buy into TEA Bagger propaganda?"

KevinC84
KevinC84

@dustie we live just south of the largest oil reserve found in the history of the world, and there is several hundred years worth, and that's only what we know about.  We aren't going to run out anytime soon.  And what people don't know, oil is formed everyday, it wasn't just formed once and then dries up.  there are oil pumps in the Penn State that have pumped since the 1920's and are still pumping oil out today!

thelakers1
thelakers1

@DavidGinsberg oh what a month makes huh pal?....we should all do everything David does!!!!!!! .... and then you get great things like obamacare, where going to the doctor not only cost more, but r better esembles your experiences at the DMV then at the doctor. 

Newsflash to liberals....Democrats spent the last 7 years telling Republicans they were too extreme and too stupid to make decision for the people.  We decided to let you libs have your way and look at what you got.  A law that is so flawed the president has to break the rules of checks and balances and adjust his own law with executive amendments because its such a strain on the economy and its consumers.  And when it starts to fail, you try to blame us for bringing nothing to the table huh? Wasn't it you who called us terrorist and couldn't do anything right, you bit it off, you gotta chew it!

Friends, look at all the folks defecting from their party, If we just let these libs go for a bit longer they are gonna drive their party off a cliff straight into the ground.  This dictators constant use of executive control is dangerous, and liberals aren't gonna be happy when the shoe is on the other foot!

HBrandon86
HBrandon86

@DavidGinsberg If you aren't a moderate you are just a foolish as the right wing nuts who have radio shows. All right wing nuts have left wing nut counterparts. 

HBrandon86
HBrandon86

@Alvord1430 except you have hard times finding fuel on long trips and in a few years your battery will need replacement and will likely cost what you have saved in gas. Plus there is the fact you paid thousands more compared to a gas powder car of similar quality. But ya the short term gives you the illusion that you are saving so much money.

thelakers1
thelakers1

@TommyFerrugia how's that obamacare doing these days....i believe the phrase is foot in mouth, but as a liberal its such a normal feeling, you don't even realize its in there.

JuventasTelsinskas
JuventasTelsinskas

@HBrandon86 @Alvord1430 you sound like a man and his horse! Those were the years in which the popular cry, “Get a Horse!” greeted almost every automobile which appeared on the roads