Gas Prices: AAA’s Fuel Gauge Report | December 24, 2012

(WASHINGTON, December 24, 2012) Today’s national average price for a gallon of regular unleaded gasoline is $3.25. This is the same price as one week ago and 18 cents less than one month ago, but it is still two cents more expensive than one year ago. After declining for 28 consecutive days, the national average has now increased for four days in a row. Today’s price is the highest on record for this calendar day and continues the streak of daily record prices that began on August 20.

Gas prices had fallen steadily for more than three months, as the transition to less-expensive, winter-blend gasoline; cheaper crude oil prices; increasing gasoline inventories; lower demand; and continued economic concerns have meant relief at the pump for drivers across the country. The national average was $3.87 on September 14, the day before much of the country began the seasonal fuel changeover, and dropped to a 2012 low of $3.22 last Thursday, December 20. As crude oil prices have firmed, the decline in retail gasoline prices has slowed and now reversed.  Whether gas prices continue to rise or again turn lower will be impacted by action – or inaction – in Washington surrounding the looming “fiscal cliff.” If a deal is reached before the end-of-year deadline it will likely be seen as positive for the U.S. economy, which could send crude prices and gas prices higher.  If a deal is not reached, markets are likely to slump and gas prices could go even lower.

Crude oil prices increased to begin last week, settling above $90 per barrel on Thursday for the first time since October 19. However as hope for resolution in Washington faded on Friday, prices again turned lower and ended the week back below that threshold. At today’s close of formal trading on the NYMEX, the price of West Texas Intermediate (WTI) settled at $88.61 per barrel, down five cents on the day.

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