August 29, 2024
Gas prices are dropping. And if you are one of the millions of Americans hitting the road this Labor Day weekend that’s probably going to help you out. And no – it’s not because of the election. I’m going to explain why it’s happening in a second but first – let’s look at the actual numbers.
The national average for a gallon of regular is $3.36. It’s the same as yesterday, three cents cheaper than a week ago, 15-cents less than a month ago and 46-cents less per gallon than a year ago.
Of course gas prices are much more expensive in the west where it’s dark red and randomly in Illinois — but also much cheaper than the average in the south. By the way most expensive gas in the nation is in California where the average for a gallon of regular was $4.63. The cheapest gas was in Mississippi where the average for a gallon of regular was $2.89.
Gas Buddy is projecting by Monday – which is Labor Day – if the downward trend keeps up the national average price for a gallon of regular would be the lowest we’ve seen since 2021. They are projecting $3.27 per gallon nationally. Now that’s just a projection so we’ll have to see if actually happens.
So why is this happening? It’s not the election. First of all the election is more than two months away. That’s a loooong time and lots of things can change between now and then when it comes to gas prices. So, get that out of your mind.
This is happening now for several reasons. But if you follow me you already know what the biggest is. The price for a barrel of oil is down. Since the price of gas is largely based on the price of oil — when oil comes down, eventually gas prices also come down. And the United States does not set the price for a barrel of oil. As I have reported for years, oil is a global commodity….it’s based on what’s happening in the world. And right now – the global demand is down. I’ll show you.
This is the price for a barrel of oil from august 2019 to today. This is covid. Obviously no one was driving. The peak was March 8, 2022 when oil $123.70 per barrel. Today — we’re down in the $74-75 per barrel range.
The other reason why these gas prices are going down in the United States is because hurricane season has been relatively quiet. None of the storms we’ve seen so far have taken out any refineries here. When one or more of those get knocked off line that also can contribute to increased gas prices in this country. But we haven’t really seen that – yet. Hurricane season is not over so that can change, but for now it’s been quiet.
So if you’re going to take advantage of these gas prices and hit the road for the holiday weekend – AAA says these are the best and worst times to drive. Be safe out there.
