Over the past three weeks, when China largely shut down and fewer people traveled, gas prices in the USA 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 costs less than $2 at more than 3,000 gas stations in the USA, according to GasBuddy.
The app’s senior petroleum analyst Patrick DeHaan said the spreading respiratory illness triggered a drop in global demand that could benefit domestic motorists for weeks to come.
“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.”
Coronavirus fighting car? Chinese automaker claims this EV ‘eliminates’ germs
Coronavirus concerns:People working out at home to avoid contact at the gym
The lower price of crude oil, which gasoline is made from, translates into lower prices at the pump.
Southern states such as Mississippi, Louisiana and Texas pay the least for gas: Per gallon averages hover around $2.01. The West Coast pays the most. The average in California and Washington sits just above $3.
Distance from supply, taxes and retail competition contribute to regional price differences. Per gallon prices have fallen in nearly every state, according to Gasbuddy.
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 reported. The Federal Reserve’s rate cuts could also affect the market, DeHaan said.
“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.