With Thanksgiving in the Rearview, National Average Eyes $2 Mark

Drivers this year paid the lowest gas prices for Thanksgiving since 2008, and the national average has now fallen for 24 straight days. Today’s average price of $2.04 per gallon is within fractions of a penny of the multi-year low reached this January, and the national average remains poised to fall below the $2 per gallon benchmark by Christmas. Gas prices are down three cents per gallon for the week, 14 cents over the last month and 74 cents compared to a year ago.

The national average has dropped for 24 of the past 30 days, largely due to the resolution of unplanned and planned refinery maintenance. The latest data from the U.S. Energy Information Administration points to rising refinery runs and output reaching its highest rates since September. Demand for gasoline typically declines during the winter months and the gasoline market may become even more oversupplied in the near term, which should keep gas prices relatively low. Barring any unanticipated disruptions in supply, or swings in the price of crude oil, retail averages are expected to continue to fall leading into 2016.

Locally, South Jersey gas prices have been stable over the past week, holding at an average of $1.91 for a gallon of unleaded gas. Today’s price is the same as last week, but is 3 cents higher than one month ago ($1.88). However, today’s price is 75 cents less per gallon than this date one year ago.

Pump prices in nearly half (22) of the states are now below $2 per gallon, and drivers in the Midwestern states of Michigan ($1.81), Missouri ($1.81) and Ohio ($1.82) are paying the nation’s lowest averages at the pump. Hawaii ($2.81) leads the market and is joined by regional neighbors California ($2.70), Nevada ($2.53), Washington ($2.46) and Alaska ($2.38) as the top five most expensive markets for retail gasoline.

Retail averages are down in the vast majority of states (46) week-over-week; however, prices have fallen more slowly than in recent weeks. Drivers in a dozen states are saving a nickel or more per gallon on the week, led by Michigan (-12 cents), Illinois (-7 cents), North Dakota (-7 cents) and Wisconsin (-7 cents). Michigan is the only state where prices have moved lower by double-digit increments over this same period. On the other end of the spectrum, pump prices have moved higher in four states, with Indiana (+6 cents) the only state posting an increase of more than fractions of a penny.

Motorists continue to experience significant monthly savings in the price at the pump, largely due to the completion of seasonal refinery maintenance. Averages are down in 45 states and Washington, D.C. month-over-month, and consumers in the majority of these states (34) are saving a nickel or more per gallon. Drivers in a total of 15 states are enjoying savings of a quarter or more per gallon with the largest monthly discounts in the Midwestern states of Michigan (-47 cents), Wisconsin (-38 cents), Ohio (-36 cents) and Illinois (-35 cents). Pump prices moved higher in five states over this same period, all by less than a nickel per gallon, led by Oregon (+4 cents), New Jersey (+3 cents) and Washington (+3 cents).

Consumers nationwide continue to experience significant yearly savings in the price of retail gasoline, thanks to the relatively low price of crude oil. Averages in 22 states have dropped 75 cents per gallon or more year-over-year, and motorists in Alaska (-$1.13), Michigan (-$1.06) and Hawaii (-$1.05) are saving more than $1 per gallon over this same period. California (-36 cents) and Nevada (-45 cents) remain the only two states where drivers are not saving at least 50 cents per gallon versus one year ago.

Oversupply and a strengthening U.S. dollar continue to impact global oil markets, keeping downward pressure on the price of crude oil. Geopolitical tensions between Russia and Turkey have yet to lead to any sustained increases in prices, and early reports indicate that tensions between the two countries will have little impact on production in the Middle East. OPEC is scheduled to meet this Friday, and analysts expect that the cartel is unlikely to reduce production despite the relatively low price of crude oil.

Domestic crude oil inventories remain elevated compared to previous years, and talks are now shifting toward the potential impacts of a surplus in gasoline inventories. WTI opened this week’s formal trading posting gains after closing out Friday’s formal trading session on the NYMEX down $1.33, settling at $41.71 per barrel.

Motorists can find current gas prices along their route with the free AAA Mobile app for iPhone, iPad and Android. The app can also be used to map a route, find discounts, book a hotel and access AAA roadside assistance. Learn more at AAA.com/mobile.