July 12, 2024

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U.S. gas prices have fallen for the last 10 weeks

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It’s not just you. Across the U.S., prices at the pump have felt milder in recent months.

Gas prices have fallen or remained steady since Sep. 19 — marking about a 70-day trajectory of decline, Andrew Gross, spokesperson for motor club AAA, said Tuesday.

As of Tuesday, the national average for gas prices stood just below $3.25, according to AAA. That’s down 25 cents from a month ago and 30 cents less than this time last year. Experts point to a recent decline in oil prices and a seasonal dip in demand, as well as easing inflation.

Each penny decline in the national average saves motorists close to $3.8 million, according to Patrick De Haan, head of petroleum analysis at GasBuddy. “If you amplify that times 30 cents, we’re talking about Americans that are spending hundreds of millions less on gasoline today than they were a year ago.”

Despite the drop, the global energy market can be volatile and lower gas prices down the road aren’t promised. Here’s what you need to know.

Why are gas prices falling?

A few factors contribute to today’s gas prices, but a big explanation behind the decline is seasonality. In other words, prices at the pump almost always ease at this time of year.

For starters, there’s a switch to winter blend gasoline — which is cheaper to produce than the summer blend, Gross notes. And, despite some upticks around the holidays, shorter days make hitting the road less enticing in the colder months.

“It’s dark and the weather is kind of crummy, and people just want to stay home,” Gross said. “Demand is a lot less (in the) fall and winter.”

On top of the seasonal cycle, inflation, while down from last year, is still high and continues to undercut Americans’ spending habits — which could also be contributing to today’s lower demand, De Haan added.

Beyond demand, experts also point to declining oil costs. Prices at the pump are highly dependent on crude oil, which is the main…

Wyatte Grantham-Philips, The Associated Press

2023-11-29 05:44:38

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