The national average for a gallon of gas in the United States is $4.655 a gallon as of July 12, according to AAA. That’s down from $4.800 a week ago and $5.01 a month ago. The all-time high of $5.016 was set on June 14.
Even drivers in the priciest states are seeing relief at the pump. For example, in California — far and away the most expensive state for motorists — the average price dipped to $6.058 on July 12, down from $6.236 a week ago and $6.434 a month ago.
The cheapest states are Georgia, Mississippi and South Carolina, where the average price was $4.18 a gallon on July 11. That looks pretty low — until you consider that a year ago, the national average was $3.147 a gallon.
Most states have seen prices fall by more than 25 cents a gallon since the national average peaked on June 14, The Hill reported. In some states, the price has fallen by nearly 50 cents, while others have seen a slight uptick in the average price.
The biggest declines over the past month or so have mostly come in the South and Midwest, according to an analysis conducted by The Hill using data from the American Automobile Association. For example, average prices in Indiana and Florida have fallen 48 cents per gallon since the middle of June. Ohio and Wisconsin have both seen a 47-cent drop, while the average price in Texas has declined by 46 cents.
As previously reported by GOBankingRates, prices in some states could soon dip below $4 a gallon for the first time since early March, according to Patrick De Haan, head of petroleum analysis at GasBuddy. He specifically pointed to states in the South stretching from North Carolina to Texas.
The reason gas prices might continue to fall is that they are tied to oil prices — and the oil market is slumping due to diminishing demand amid fears of a global recession.
Last week, oil speculators cut their net long futures and options positions on the NYMEX and Intercontinental Exchanges to their lowest level since April 2020, Reuters reported.
“The oil market is being pulled in two directions with exceedingly tight physical fundamentals set against forward-looking demand concerns and signs of price-induced demand destruction,” analysts at EBW Analytics said in a note.
Oil markets also were spooked this week on the news that China discovered its first case of a highly transmissible Omicron subvariant in Shanghai that could prompt another round of mass testing, which would hurt fuel demand.
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