Why Are Gas Prices Going Down?

why are gas prices going down

Gasoline prices, which had hit record highs in recent months are now falling sharply inching closer to an average of $4 a gallon across the county. On Monday, August saw average gas prices reach $4.059 down from $4.212 a week ago, according to the American Automobile Association (AAA).

Gas prices have been falling steadily from the record high of $5.03 per gallon in June bringing some relief for drivers. Despite the recent decline in gas prices, gas at the pump is some 87 cents higher from last year, this time last year a gallon of gas was $3.188.

Gas Prices Drop

The District of Columbia, Colorado, Arizona, and Illinois saw the highest decrease in gas prices with an average of 20 cents drop in gas prices.  Gas prices in The District of Columbia fell from $4.533 to $4.254 within a week. Similarly, Colorado saw prices at the pump reach $4.171 from a high of 4.400 last week.

Despite the respite in gas prices some states still continue to feel the pinch at the pump.

Drivers in California on average pay $5.446 a gallon while Alaskans pay on average $4.98 for a gallon of gas.  This is despite gas prices falling by over ten cents since last week in both states. The states of Hawaii, Vermont, and Pennsylvania showed marginal decreases when compared to figures from across the country.

Highest Gas Prices

State  Regular  Mid-Grade  Premium  Diesel 
California 5.446 5.656 5.801 6.31
Hawaii 5.42 5.649 5.867 6.086
Alaska 4.982 5.199 5.367 5.598
Nevada 4.976 5.227 5.426 5.259
Oregon 4.94 5.148 5.36 5.853

At the other end of the spectrum, several other states have seen their gas prices below the $4 and inch close to last year’s prices, the majority being in the south. For example, average gas prices in Texas are at $3.572 while in South Carolina it is $3.604 a gallon down from $ 3.747 a week ago.  Other states with average gas prices below $3.70 include Georgia, Arkansas, Mississippi, Tennessee, and Alabama.

Lowest Gas Prices

State  Regular  Mid-Grade  Premium  Diesel 
Texas 3.557 3.92 4.255 4.623
South Carolina 3.591 3.987 4.327 4.784
Oklahoma 3.603 3.942 4.186 4.631
Arkansas 3.604 3.988 4.307 4.787
Georgia 3.618 4.019 4.38 4.87

Are gas prices going to go down again?

Recent weeks have shown that gas prices are on a trajectory to keep falling for at least the next few weeks. The decline comes as global fuel demand has been declining due to high prices and a strong U.S. dollar making oil more expensive elsewhere. On the consumer side, high gas prices had prompted consumers to buy less gas allowing for a decrease in demand for gas.

Last week, demand dropped from 9.25 million barrels a day to 8.54 million barrels a day. Domestic gasoline stocks also increased slightly by 200,000 billion barrels to 225.3 million billion barrels. Projections indicate that if demand for gas remains low and stocks continue to rise alongside falling crude prices, drivers could see gas prices reaching last year’s prices.

Gas Price Trends

  Regular Mid-Grade Premium Diesel E85
Current Avg. 4.059 4.503 4.803 5.143 3.329
Yesterday Avg. 4.069 4.518 4.818 5.158 3.346
Week Ago Avg. 4.212 4.651 4.952 5.279 3.468
Month Ago Avg. 4.721 5.16 5.455 5.675 4.034
Year Ago Avg. 3.188 3.54 3.815 3.297 2.684

When will gas prices go up?

All indications point to gas prices stabilizing and going down provided that there are no interruptions in the supply of gas. Currently, the nation is seeing gasoline inventories growing to allow for some cushion from rising gas prices. Incidents such as supply chain breakdowns from refinery breakdowns or hurricanes could cause another rise in gas prices.

State Gas Prices August 8, 2022

State  Regular  Mid-Grade  Premium  Diesel 
Alaska 4.982 5.199 5.367 5.598
Alabama 3.642 4.039 4.414 4.868
Arkansas 3.604 3.988 4.307 4.787
Arizona 4.285 4.592 4.858 5.15
California 5.446 5.656 5.801 6.31
Colorado 4.171 4.538 4.832 5.011
Connecticut 4.221 4.738 5.099 5.354
District of Columbia 4.254 4.782 5.135 5.39
Delaware 3.932 4.402 4.669 4.966
Florida 3.776 4.202 4.523 4.984
Georgia 3.618 4.019 4.38 4.876
Hawaii 5.42 5.649 5.867 6.086
Iowa 3.664 3.962 4.385 4.798
Idaho 4.795 5.038 5.252 5.353
Illinois 4.422 4.924 5.302 5.293
Indiana 3.958 4.382 4.716 5.401
Kansas 3.664 3.933 4.231 4.732
Kentucky 3.667 4.088 4.422 5.015
Louisiana 3.681 4.064 4.401 4.761
Massachusetts 4.37 4.876 5.167 5.456
Maryland 4.028 4.534 4.803 5.054
Maine 4.466 4.878 5.202 5.451
Michigan 4.031 4.478 4.835 5.411
Minnesota 3.978 4.36 4.707 5.114
Missouri 3.667 4.02 4.335 4.745
Mississippi 3.628 3.996 4.36 4.767
Montana 4.308 4.592 4.871 4.967
North Carolina 3.755 4.146 4.503 5.043
North Dakota 3.976 4.297 4.706 4.885
Nebraska 3.866 4.063 4.549 4.821
New Hampshire 4.236 4.706 5.023 5.423
New Jersey 4.282 4.825 5.079 5.256
New Mexico 3.821 4.152 4.406 4.921
Nevada 4.976 5.227 5.426 5.259
New York 4.427 4.865 5.183 5.622
Ohio 3.738 4.161 4.501 5.347
Oklahoma 3.603 3.942 4.186 4.631
Oregon 4.94 5.148 5.36 5.853
Pennsylvania 4.383 4.757 5.029 5.521
Rhode Island 4.295 4.837 5.142 5.415
South Carolina 3.591 3.987 4.327 4.784
South Dakota 4.028 4.254 4.759 4.941
Tennessee 3.622 4.005 4.368 4.855
Texas 3.557 3.92 4.255 4.623
Utah 4.723 4.948 5.144 5.084
Virginia 3.85 4.287 4.621 5.044
Vermont 4.415 4.904 5.301 5.14
Washington 4.864 5.102 5.282 5.766
Wisconsin 3.724 4.159 4.549 4.853
West Virginia 4.152 4.439 4.697 5.356
Wyoming 4.237 4.455 4.708 5.106

Image: Envato

This article, “Why Are Gas Prices Going Down?” was first published on Small Business Trends