Gas Prices Are Expected to Drop Big Time, But When?
From Time Moneyland Smart Spending
By BRAD TUTTLE
Since May, the national average for a gallon of gas has dropped from $3.95 to the current price of $3.63. The experts predict that you'll save even more the longer you wait to fill up. Crude oil prices have dropped sharply over the past two weeks, and since retail gasoline rates follow the lead of crude, prices at the pump are expected to plummet going forward.
When will drivers start seeing cheaper prices at gas stations? By some indication, the process has already begun. Per AAA's Fuel Gauge Report, the current national average is $3.637 per gallon of regular gasoline—down from $3.701 one week ago, and from $3.652 just yesterday.
Oil prices, which neared $100 per barrel last week, have now dipped to around $80, according to the Associated Press, largely due to economic uncertainty amid the U.S.'s loss of its top credit rating. Crude oil is purchased by refiners and changed into fuel, so when oil prices decrease, gas station prices follow suit, though not as quickly as drivers might like.
An industry expert at GasBuddy.com says he expects "prices at the pump to decrease nearly daily," and that by next week, the national average could be as low as $3.54. Experts cited by the AP and the Detroit Free Press, meanwhile, are predicting that the average price of gas will continue its downward trend, likely dropping an additional 20¢ or 30¢ in the weeks to come. By next month, the typical gallon of gas could run $3.35—which would save the average driver $33 a month compared to the spring.
Everything's relative, though. According to AAA's Fuel Gauge Report, one year ago, the national average price of a regular gallon of gasoline was $2.78.