For the first time in four years, the national average for a gallon of gas has dropped below $2, according to AAA.
A crude oil price war between Saudi Arabia and Russia, paired with a decrease in travel due to travel restrictions caused by the coronavirus pandemic, are the reasons. The national average for a gallon of regular stood at $1.99, AAA said in a news release Tuesday. Twenty-nine states are averaging less than $2, the organization said.
AAA anticipates an even further decline in gasoline prices, projecting a national average of $1.75 for regular sometime in April.
The coronavirus’ effect has been felt in the price of crude oil, which has dropped to $20 per barrel -- the lowest price since 2002, AAA said.
Demand is weak because many Americans are under shelter-in-place rules, and businesses have been closed down because of COVID-19, MarketWatch reported.
“AAA expects gas prices to keep dropping as cheap crude combines with the realities of people staying home and less demand for gas,” AAA spokeswoman Jeanette Casselano said in a news release. “Today, motorists can find gas for $1.99 or less at 68% of gas stations in the country.”
Consumers interested in state, metro and county prices can check Gasprices.AAA.com. According to the site, the lowest average price is $1.55 in Oklahoma, while the highest prices were seen in Hawaii ($3.36) and California ($3.04).
The national average price was even lower on GasBuddy. Tuesday afternoon’s average for a gallon of regular on the website was $1.95, with Oklahoma having the lowest average ($1.55). Hawaii held the highest average ($3.29), with California second at $3.
“The EPA’s extension of the winter-blend gasoline waiver will contribute to sustained lower prices, especially as U.S. gasoline demand readings look more like winter-driving season than spring,” Casselano said in the news release.
Until crude oil prices and demand for gasoline increase, lower gas prices should be the norm “for the foreseeable future,” AAA said.
Patrick De Haan, an analyst for GasBuddy, said retail prices will eventually reflect the faster decline in wholesale prices.
“Retailers are taking their time lowering prices because they have a lot of uncertainty around the corner,” DeHaan told MarketWatch on Monday. “We’ve never seen gasoline retailers doing as well as they are now.”