Forget visions of sugar plums this holiday season. The bigger expectation is that gas could be cheaper than $2 a gallon in some areas by Christmas.
The national average for regular unleaded stood at a four-year low of $2.73 Thursday, according to the AAA Daily Fuel Gauge Report — not even close to $2. But the statewide average was $2.50 or less in Missouri ($2.41), Mississippi ($2.49) and South Carolina ($2.50). Cities such as St. Louis ($2.32) and Amarillo, Texas ($2.38), were even lower, and dozens of gas stations were beating those prices.
For example, spotters on GasBuddy.com Thursday reported prices as low as $2.13 in the St. Louis area, and several stations were selling regular at $2.14. AAA estimated that more than 15 percent of stations around the country were selling regular for less than $2.50.
Gas prices have declined for 70 straight days. That 10-week skid, the longest consecutive daily decline since fall 2008, has many wondering how low they can go.
In its monthly gas price report, AAA said it expects gasoline to drop another 15-20 cents per gallon by the end of the year and for prices to “remain relatively low this winter.”
“We could see prices drop to the lowest levels since the Great Recession if the cost of crude oil continues to set multi-year lows,” AAA spokesman Avery Ash said in a release. As far as $2 gas coming soon to a station near you, AAA said that was unlikely to be widespread.
“While it is possible that a small handful of gas stations in the Southeast and Midcontinent may soon offer gas prices for less than $2 per gallon this month, it would probably take crude oil prices dropping another $25-$30 a barrel for the national average price of gasoline to reach that point,” the AAA report said.
The notion that pump prices could dip below $2 gained traction last week when, while most Americans were celebrating Thanksgiving, the OPEC oil cartel couldn’t reach consensus to cut oil production to curb a five-month decline in prices. After OPEC decided to continue producing 30 million barrels per day, despite a global glut of oil, the price of oil plunged even more.
U.S. oil prices hit a four-year low of $63.72 a barrel Monday but had rebounded to nearly $67 a barrel in early trading Thursday.
The national average for regular gas has fallen 61 cents since the 10-week price decline began Sept. 25, and at $2.73 it is 97 cents less than the 2014 high of $3.70, set on April 28. Americans on average are paying 53 cents per gallon less than a year ago for regular. The $3.13 average for premium is 47 cents less than a year ago, and diesel, at a current national average of $3.54, is 31 cents cheaper.
Regular averaged more than $3 in only seven states as of Thursday, and three of those — California, Vermont and Washington — were within a few pennies of breaking that threshold. If the downward price trend continues a few more weeks, by Christmas Alaska and Hawaii could be the only states more than $3. Hawaii’s statewide average was $3.83 and Alaska’s was $3.49.
Cars.com photo by Evan Sears