Why Are Gas Prices Going Down?



gas prices drop

Gasoline prices, which had hit record highs in recent months are now falling sharply inching closer to an average of $4 a gallon across the county. On Monday, August saw average gas prices reach $4.059 down from $4.212 a week ago, according to the American Automobile Association (AAA).

Gas prices have been falling steadily from the record high of $5.03 per gallon in June bringing some relief for drivers. Despite the recent decline in gas prices, gas at the pump is some 87 cents higher from last year, this time last year a gallon of gas was $3.188.

 



Gas Prices Drop

The District of Columbia, Colorado, Arizona, and Illinois saw the highest decrease in gas prices with an average of 20 cents drop in gas prices.  Gas prices in The District of Columbia fell from $4.533 to $4.254 within a week. Similarly, Colorado saw prices at the pump reach $4.171 from a high of 4.400 last week.

Despite the respite in gas prices some states still continue to feel the pinch at the pump.

Drivers in California on average pay $5.446 a gallon while Alaskans pay on average $4.98 for a gallon of gas.  This is despite gas prices falling by over ten cents since last week in both states. The states of Hawaii, Vermont, and Pennsylvania showed marginal decreases when compared to figures from across the country.

Highest Gas Prices



State Regular Mid-Grade Premium Diesel 
California5.4465.6565.8016.31
Hawaii5.425.6495.8676.086
Alaska4.9825.1995.3675.598
Nevada4.9765.2275.4265.259
Oregon4.945.1485.365.853

At the other end of the spectrum, several other states have seen their gas prices below the $4 and inch close to last year’s prices, the majority being in the south. For example, average gas prices in Texas are at $3.572 while in South Carolina it is $3.604 a gallon down from $ 3.747 a week ago.  Other states with average gas prices below $3.70 include Georgia, Arkansas, Mississippi, Tennessee, and Alabama.

Lowest Gas Prices

State Regular Mid-Grade Premium Diesel 
Texas3.5573.924.2554.623
South Carolina3.5913.9874.3274.784
Oklahoma3.6033.9424.1864.631
Arkansas3.6043.9884.3074.787
Georgia3.6184.0194.384.87

Are gas prices going to go down again?

Recent weeks have shown that gas prices are on a trajectory to keep falling for at least the next few weeks. The decline comes as global fuel demand has been declining due to high prices and a strong U.S. dollar making oil more expensive elsewhere. On the consumer side, high gas prices had prompted consumers to buy less gas allowing for a decrease in demand for gas.

Last week, demand dropped from 9.25 million barrels a day to 8.54 million barrels a day. Domestic gasoline stocks also increased slightly by 200,000 billion barrels to 225.3 million billion barrels. Projections indicate that if demand for gas remains low and stocks continue to rise alongside falling crude prices, drivers could see gas prices reaching last year’s prices.



Gas Price Trends

 RegularMid-GradePremiumDieselE85
Current Avg.4.0594.5034.8035.1433.329
Yesterday Avg.4.0694.5184.8185.1583.346
Week Ago Avg.4.2124.6514.9525.2793.468
Month Ago Avg.4.7215.165.4555.6754.034
Year Ago Avg.3.1883.543.8153.2972.684

When will gas prices go up?

All indications point to gas prices stabilizing and going down provided that there are no interruptions in the supply of gas. Currently, the nation is seeing gasoline inventories growing to allow for some cushion from rising gas prices. Incidents such as supply chain breakdowns from refinery breakdowns or hurricanes could cause another rise in gas prices.

State Gas Prices August 8, 2022



State Regular Mid-Grade Premium Diesel 
Alaska4.9825.1995.3675.598
Alabama3.6424.0394.4144.868
Arkansas3.6043.9884.3074.787
Arizona4.2854.5924.8585.15
California5.4465.6565.8016.31
Colorado4.1714.5384.8325.011
Connecticut4.2214.7385.0995.354
District of Columbia4.2544.7825.1355.39
Delaware3.9324.4024.6694.966
Florida3.7764.2024.5234.984
Georgia3.6184.0194.384.876
Hawaii5.425.6495.8676.086
Iowa3.6643.9624.3854.798
Idaho4.7955.0385.2525.353
Illinois4.4224.9245.3025.293
Indiana3.9584.3824.7165.401
Kansas3.6643.9334.2314.732
Kentucky3.6674.0884.4225.015
Louisiana3.6814.0644.4014.761
Massachusetts4.374.8765.1675.456
Maryland4.0284.5344.8035.054
Maine4.4664.8785.2025.451
Michigan4.0314.4784.8355.411
Minnesota3.9784.364.7075.114
Missouri3.6674.024.3354.745
Mississippi3.6283.9964.364.767
Montana4.3084.5924.8714.967
North Carolina3.7554.1464.5035.043
North Dakota3.9764.2974.7064.885
Nebraska3.8664.0634.5494.821
New Hampshire4.2364.7065.0235.423
New Jersey4.2824.8255.0795.256
New Mexico3.8214.1524.4064.921
Nevada4.9765.2275.4265.259
New York4.4274.8655.1835.622
Ohio3.7384.1614.5015.347
Oklahoma3.6033.9424.1864.631
Oregon4.945.1485.365.853
Pennsylvania4.3834.7575.0295.521
Rhode Island4.2954.8375.1425.415
South Carolina3.5913.9874.3274.784
South Dakota4.0284.2544.7594.941
Tennessee3.6224.0054.3684.855
Texas3.5573.924.2554.623
Utah4.7234.9485.1445.084
Virginia3.854.2874.6215.044
Vermont4.4154.9045.3015.14
Washington4.8645.1025.2825.766
Wisconsin3.7244.1594.5494.853
West Virginia4.1524.4394.6975.356
Wyoming4.2374.4554.7085.106

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Samson Haileyesus Samson Haileyesus is a staff writer for Small Business Trends and has several years of progressive experience in media, communication and PR working with government, NGOs and private sector. He is passionate about public outreach, branding, media relations and marketing.

One Reaction
  1. The high cost led to lower demand and with US schools beginning again (and the end of summer traveling) we should see more decreases in demand. That should lead to continuing lower prices since supply seems to be steady.

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