BIDENOMICS

Average U.S. Gasoline Price Set to Drop Below $3 for the First Time Since 2021

By Charles Kennedy - Oct 28, 2024

The U.S. national average gasoline price is expected to fall below $3 per gallon for the first time since 2021.

This decline is primarily driven by lower oil prices, which have been impacted by de-escalation in the Middle East and weaker global demand.

The upcoming winter season will further reduce demand for gasoline, contributing to the price decline.


The U.S. national average price of gasoline is set to soon fall below $3 per gallon for the first time since 2021, amid lower seasonal demand and a decline in international oil prices, according to fuel platform GasBuddy.

Over the last week, the U.S. national average price fell for the second consecutive week and was at $3.07 per gallon early on Monday, according to GasBuddy data compiled from more than 12 million individual price reports covering over 150,000 gas stations across the country.

The national average price is now down by 12.9 cents from a month ago and 39.8 cents per gallon lower than a year ago.

The national average price of diesel has also been falling, and is already at a three-year low of $3.54 per gallon, according to GasBuddy’s data


The U.S. is likely to see the average U.S. gas prices fall below $3 per gallon in the next 7-12 days if the current bearishness on oil markets holds, Patrick De Haan, head of petroleum analysis at GasBuddy, said today.

A drop below $3 per gallon for the national average would be the first since 2021, he added.

WTI Crude prices were plummeting by 6% early on Monday after Israel’s measured response to Iran’s missile attack early this month. The limited Israeli strike on targets in Iran over the weekend sent prices plunging on Monday as concerns about an oil supply disruption from the region began to abate.

If the tentative signs of de-escalation hold, the U.S. could see the national average price of gasoline below $3 as soon as next week.

“While many Americans may incorrectly credit the upcoming election for the declines, politicians have little influence over the strong seasonal forces that drive prices lower in autumn,” De Haan wrote today.

“With winter gasoline soon to reach the rest of California, and demand continuing to decline as Americans grapple with colder weather, the drop in demand is pushing gas prices down — not politicians on either side, as much as they might like to think they do.”

De Haan expects the drop in gasoline prices will continue into and even beyond the presidential election.

By Charles Kennedy for Oilprice.com