Gas Prices Extend Record Slide to more than 100 Straight Days

Michael Green Contact Tile(WASHINGTON, January 5, 2015) The national average price of gas has fallen for a record 102 days to $2.20 per gallon, which is the lowest average since May 9, 2009. Drivers closed out 2014 on a high note with households saving an average of approximately $115 on gasoline in comparison to 2013 due to relatively low prices at the pump. The average price for retail gasoline hit multi-year lows during the last few months of 2014 and is expected to continue to fall as we begin 2015. Consumers are saving nine cents compared to one week ago, 49 cents compared to one month ago and $1.12 per gallon compared to this same date last year.

The national average price has fallen every day since September 25 for a total of $1.15 per gallon. Today’s price is $1.50 (approximately 40 percent) less than the 2014 peak of $3.69 per gallon on April 28. Barring any significant fluctuations in the price of crude oil, the average price at the pump is likely to remain below $3.00 per gallon in 2015, although prices may see seasonal increases this spring as refineries undergo maintenance, or this summer as demand increases during the busy summer driving season.

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Drivers in 43 states are paying an average price that is below $2.50 per gallon and seven states boast averages below $2.00 per gallon. Drivers in 40 states can find at least one station selling gas for less than $2.00 per gallon today. The center of the country continues to pay the lowest prices, led by averages in Missouri ($1.86), Oklahoma ($1.89), Ohio ($1.90), Michigan ($1.90), Indiana ($1.92) Kansas ($1.92) and Texas ($1.98). The average price for retail gasoline in Alaska slipped below $3.00 per gallon today for the first time since June 2009, leaving Hawaii ($3.48) as the only state with an average price above the $3.00 threshold. Motorists in New York ($2.72), Vermont ($2.66) and California ($2.65) are still paying the highest averages in the continental U.S. and round out the top five most expensive markets for retail gasoline.

The average price at the pump is down in every state and Washington, D.C. week-over-week. Minnesota (-15 cents), Idaho (-15 cents) and Michigan (-14 cents) are posting the largest savings over this period, and are joined by 17 other states where motorists are saving a dime or more at the pump. Consumers in 47 seven states and Washington, D.C. are experiencing weekly savings of at least a nickel per gallon to refuel their vehicles. With the exception of California (-8 cents), the average price for retail gasoline has fallen by a dime or more in every state and Washington, D.C. over the last two-weeks. The largest savings over this stretch are in Michigan (-31 cents), Idaho (-30 cents), Ohio (-30 cents) and Utah (-29 cents).

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Since this time last month, the price at the pump has fallen in every state and Washington, D.C. by more than 30 cents per gallon. Motorists in 21 states are saving 50 cents or more per gallon to refuel their vehicles, with the same bi-weekly savings leaders — Michigan (-81 cents), Idaho (- 79 cents) and Ohio (-74 cents) — not surprisingly posting the largest savings over this same span.

The most extreme discounts in the price at the pump are reflected in yearly comparisons. Averages are down by $1.00 or more in 39 states, with the largest declines in Michigan (-$1.41), Indiana (-$1.41), Ohio (-$1.41) and Illinois (-$1.28). Consumers in almost every state and Washington, D.C. are saving at least 75 cents per gallon; Hawaii (-48 cents) and Alaska (-65 cents), the nation’s most expensive gasoline markets, are the two exceptions.

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The price of crude is continuing its downward slide due to excess supply and weak demand, and is on the precipice of falling below $50 per barrel today for the first time since April 2009. Global oil prices are expected to remain relatively low for the first half of 2015, which could put additional pressure on high-cost production countries like the United States. Rebel forces continue to disrupt supply from OPEC member country Libya, yet the level of global oversupply appears capable of easing concerns that might otherwise send prices higher due to production concerns.

Sustained low prices for crude have the potential to impact domestic production, with both upstream and downstream companies reportedly beginning to reassess their plans moving forward. Although it is too early to tell what, if any, impact low crude prices will have on domestic production, it is worth noting that companies will increasingly face the choice of either continuing expansion plans or cutting capital expenditures in a market that offers significantly lower profit margins.

The global price of crude has lost more than half of its value since mid-2014. At the close of formal trading on Friday, WTI fell by 58 cents per barrel and settled at $52.69. This marks the lowest settlement since April 30, 2009.

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