Gas Prices Drop As OPEC Maintains Oil Production Levels

Michael Green(WASHINGTON, December 1, 2014) Drivers enjoyed the lowest retail average for Thanksgiving since 2009, with the national average at $2.80 per gallon this past Thursday, and pump prices are poised to continue to drop this holiday season. The national average has fallen on 67 consecutive days, for a total drop of 58 cents during this streak. Today’s price of $2.77 is four cents less than one week ago, 23 cents less than one month ago and 50 cents less than one year ago. The national average is the lowest since October 7, 2010, and the year-over-year discount is the widest mark since October 17, 2009.

Avg Gas Prices 2011-2014

The national average has been below the $3.00 per gallon benchmark for exactly one month, and 42 states are now registering averages below $3.00 per gallon. This number is set to increase in the coming days and it’s likely that New York and Connecticut will be the only states in the lower 48 above this threshold by the end of next week.

Motorists filling their tanks in the nation’s cheapest gasoline markets are enjoying prices more than 40 cents below the $3.00 benchmark. Tumbling crude prices continue to put downward pressure on the price at the pump with drivers in Missouri ($2.47), Mississippi ($2.53), South Carolina ($2.53) and Texas ($2.54) paying the nation’s lowest prices per gallon. For the fourth week in a row, the average price at the pump is below $4.00 per gallon in every state and Washington, D.C. Hawaii ($3.87), Alaska ($3.50), New York ($3.16) and Connecticut ($3.11) lead the retail gasoline market with the nation’s highest averages.

10 least Expensive Avg Gas Prices-12-01-14

Consumers in 48 states and Washington, D.C. are experiencing week-over-week savings. The average price at the pump is down by a nickel or more in 18 states, with the largest savings in Missouri (-10 cents), South Dakota (-9 cents), Utah (-9 cents) and Idaho (-9 cents). Consumers in the Midwestern states of Ohio (+2 cents) and Indiana (fractions of a penny) are paying a bit more to refuel their vehicles over this same period, but prices in the region are positioned to head lower over the next week as wholesale prices have fallen.

The average price at the pump is down in every state and Washington, D.C. month-over-month. Every state but Delaware is registering a double-digit discount and drivers in 17 states are saving more than a quarter per gallon. States in the Midcontinent region are recording the largest savings over this period: Oklahoma (-46 cents), Minnesota (-43 cents), South Dakota (-43 cents) and Missouri (-38 cents).

Year-over-year comparisons reflect the most extreme discounts in the price at the pump, led by states located in the Southern and Gulf Coast Regions: Florida (-68 cents), South Carolina (-63 cents), Virginia (-61 cents) and Mississippi (-61 cents). With the exception of Hawaii (-6 cents), drivers in every state and Washington, D.C. are experiencing savings of a dime or more and average prices are down by a quarter or more per gallon in 44 states and Washington, D.C.

Top10 Monthly Savings-12-01-14

Sharply lower global oil prices have been the driving factor for lower retail gas prices. Prices dropped even lower last week when, despite the falling price of global oil, the Organization of Petroleum Exporting Countries (OPEC) elected to maintain its collective production ceiling when the group met last Thursday. There had been speculation that the group might take some action to cut collective production to raise prices. This leaves the balance between supply and demand to decide the global price of oil, and with supply outpacing demand the price for crude is expected to remain relatively low. Following the news, West Texas Intermediate (WTI) plummeted more than ten percent ($7.54) in Friday’s trading to settle at $66.15 per barrel. The ultimate market implications for OPEC’s inaction remain unclear, however many market watchers have indicated that they see it as a signal that the oil cartel is more focused on maintaining market share and hoping for prices to stabilize in the winter months as global demand increases.

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