Gas Prices Hit Seven-Month Low And Could Keep Dropping: Here’s Where Gas Is Cheapest - Forbes

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The national average price for a gallon of gasoline dropped to a seven-month low Saturday, as waning demand and the transition to a cheaper winter fuel blend help save drivers money at the pump, even as oil prices remain at near-historic levels.

Key Facts

Gas prices in the U.S. dropped to $3.45, on average Saturday, the lowest price since March 28, according to data from GasBuddy.

Prices are lowest across the Southeast, led by Georgia, where drivers pay an average of $2.97 per gallon, followed by Mississippi and Texas ($2.99), Louisiana ($3.05) Alabama ($3.06), South Carolina ($3.08), Arkansas ($3.10) and Tennessee ($3.12), according to AAA.

The state with the most expensive gas: California ($5.31), which typically sees some of the country’s highest gas prices due to a combination of factors including high gas taxes and the use of a more expensive fuel blend.

No other state averages more than $5 per gallon for gas, though six other states have gas above $4 per gallon: Hawaii ($4.77), Washington ($4.71), Nevada ($4.60), Oregon ($4.34), Alaska ($4.30) and Arizona ($4.04), according to AAA—gas prices have dropped in each of those states over the past month.

Declining gas prices come as gasoline stocks increase and as demand for gasoline dips slightly from 8.94 million barrels per day to 8.86 million barrels over the seven-day period ending Wednesday, according to data from the Energy Information Administration.

AAA spokesperson Andrew Gross said this week drivers should expect prices to continue on a “slow slide toward the holidays.”

Contra

Oil, which is refined into gasoline, often sets the mark for the price drivers pay at the pump, with high oil prices typically triggering a jolt in gas prices. That has not been the case in recent weeks, however, after oil prices hit an 11-month high last month with the Brent Crude Oil international benchmark reaching $95 per barrel and the U.S. benchmark West Texas Intermediate climbing to $93 (Brent has since dropped to $90 while the West Texas Intermediate fell to $85).

Tangent

Oil prices have experienced roller coaster fluctuations over the past year, stemming from factors like Russia’s invasion of Ukraine and European sanctions on Moscow, as well as oil-rich Saudi Arabia’s decision in June to cut oil production by 1 million barrels per day. Russia is also reducing its oil output by 300,000 barrels per day.