Over the past three weeks, with China largely shut down and fewer people traveling, gas prices in the U.S. have fallen 6 cents per gallon, according to data compiled by the fuel price platform GasBuddy.
As of Wednesday, the national average sits at $2.41, which is $1.70 less than the highest recorded average of $4.11 set in July 2008. A gallon of gas currently costs under $2 at more than 3,000 gas stations in the U.S., according to GasBuddy.
The app’s senior petroleum analyst Patrick DeHaan says the spreading respiratory illness has triggered a drop in global demand that could benefit domestic motorists for weeks to comes.
“Tens of thousands of flights have been canceled, people have been told to stay from school and work, and now that’s spreading,” DeHaan said. “What you’re seeing is a reduction in oil demand globally that has pushed the price of oil down.”
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The lower price of crude oil, which gasoline is made from, translates into lower prices at the pump.
Currently, southern states like Mississippi, Louisiana and Texas are paying the least for gas, with per gallon averages hovering around $2.01. The West Coast is paying the most. The average in California and Washinton sits just above $3.
Distance from supply, taxes and retail competition contributes to regional price differences. However, per gallon prices have fallen in nearly every state in recent weeks, according to Gasbuddy.
Still, there are caveats that can send gas prices in the other direction.
Geopolitics and the switch to summer blends could cause prices to rise, though by how much is partly dependent upon how long and how widespread coronavirus becomes.
The world’s top oil-producing nations, OPEC, will consider making production cuts to lift prices in the wake of the coronavirus crisis as early as this week, Reuters reports. And the Federal Reserve’s most recent rate cuts could also have a noticeable impact on the market, DeHaan noted.
“If this does continue to spread and the overall mood remains negative, then gas prices will continue to decline,” DeHaan said. “Gas prices are very much tied to the future of coronavirus.”
Follow Dalvin Brown on Twitter: @Dalvin_Brown.