Gas prices have been such a source of stress for many people in recent times. Gas prices have reached record high prices in recent years, leaving many people wondering how they were going to afford to fill up their gas tanks. In comparison to one year ago, gasoline prices are considerably lower.
Inflation has finally begun to decrease, and along with that, gas prices have also started to drop. The current average cost for a gallon of gasoline is around $3.35. In the past week alone, prices have decreased by 15 cents per gallon.
This rapid gas price decrease comes at a great time. The holiday season is here and in full swing. Despite a shaky economy, people do not want to give up holiday shopping.
Currently, refineries are operating in overtime. There is a shortage of diesel and an oversupply of gasoline. This oversupply of gasoline is resulting in lower gas prices in all states.
As refineries are working hard to catch up with diesel demands, the result is that there is an oversupply of gasoline and a decrease in gas prices. With the current excess of gasoline, there is nowhere to store the gas. Customers can expect to see gasoline fall below $3 a gallon before the end of the year.
With such an oversupply of gasoline and nowhere to put it, consumers can expect to see the lowest gas prices they’ve seen in years. Experts in the field are anticipating that by Christmas morning, prices could be as low as $2.99.This is a much-welcomed price break.
Oil refineries have cut back production by as much as two million barrels a day. Even with the cutback in production, prices are still falling. So far, barrel prices are down by nearly 2%.
Though cutbacks in productions have been implemented, refineries still have to work to catch up to diesel demands. Right now, refineries are 7% behind compared to last year. Refineries have no choice but to fulfill the need for diesel, and along with that, extra gas is inevitable.
Some states may already be seeing gas prices below $3. In other states, prices may still be above $4. As the cost of living varies from state to state, this is not uncommon to see a variation in gas prices.
Even with the variation in gas prices among states, the average is still sitting slightly above $3. During the summer, gas prices reached nearly $7 in states. The numbers consumers are seeing now are well below the record-high numbers from a short time ago.
One major factor that could stop gas prices from falling is the changes that are happening in China. China has recently reopened and loosened some restrictions regarding COVID protocol. The reopening of The Chinese economy could trigger a spike in gas prices.
As the Chinese economy slowly begins to reopen, this would make the demand for oil and gas to increase. As of now, gasoline prices are set to keep decreasing. Consumers will just have to wait and see what exactly plays out as China begins to reopen.