Gasoline prices in the United States have been falling fairly steadily since reaching a high of $3,881 in 2023.
In fact, as of Sunday (Dec. 3), the U.S. national average price was $3.243 a gallon, according to the American Automobile Association. Daily fuel gauge report. That's 16.4% lower than the September 18 high price and 35.3% lower than the 2022 high price of $5,016.
Prices should continue to fall through early 2024. But that assumes global oil prices will continue to fall until refiners begin preparing for the summer driving season. However, this is not a certainty.
The rise in the price of gas in one day
To wit: On December 1, the AAA price rose. Just 0.2 cents a gallon at $3.248, but it came after the price held at $3.46 for three days.
The cause of the problem was that the Organization of the Petroleum Exporting Countries and the OPEC+ group met on November 30 to agree on crude oil production quotas.
Oil prices had begun to rise after Thanksgiving on expectations of sharp production cuts.
Related: New Report Highlights Major Obstacle to Mass Adoption of Electric Vehicles
In fact, the cartel agreed to continue cutting production. But the decision came with a caveat. The cuts are voluntary. (Technically, issue members had to commit to honoring the cuts.) This means that no one is formally bound by the agreement, and many OPEC members can sell more oil than allowed under the cartel's quota system.
Once oil traders realized that reality, oil prices fell nearly 5% over the next two days. And AAA saw that drop driving down pump prices on December 2 and 3.
Gas prices are seasonal and political.
Gasoline prices are seasonal and fall in the fall and into the winter. They rise after the start of the year, until spring and early summer, when holiday driving increases in the northern hemisphere and refiners change their ingredient mixes, adding some chemicals to reduce the volatility of gasoline.
To further complicate the situation, oil prices, which account for about half the cost of a gallon of gasoline, are volatile and subject to geopolitical and economic forces.
One solution to draining your wallet is to buy an electric or hybrid vehicle. But prices are high and demand for hybrid cars is intense.
So, in the short term, let's look at the consequences of drone attacks on several shipsincluding a US destroyer, in the Red Sea, near its mouth into the Gulf of Aden, on December 3. The attacks were apparently launched by Yemen's Houthi rebels, who have supported Hamas in the group's war against Israel.
The lowest prices in the United States are currently in Texas, where prices are approaching $2.60 per gallon. The highest prices are in California, which averages $4,806 a gallon. The highest price is in rural Mono County: $6.46.
