Average gas price in U.S. heads below $2 for first time since 2009

DALLAS -- Gasoline is close to breaking below a key psychological barrier in the United States, as drivers enjoy some of the cheapest pump prices since the recession.

See Full Article

The nationwide average price of a gallon of regular Saturday was US$2.02, down 58 cents from this time last year, according to auto club AAA. Experts say it could drop below $2 in the coming days.

For consumers, this winter is shaping up to be a good one, energy-wise: With oil below $40, natural gas under $2, and a relatively warm winter predicted, they also stand to pay less to heat their homes.

According to data compiled by AAA and the Oil Price Information Service, drivers in about half of the states are already paying below $2 for gas. South Carolina has the lowest average price at $1.79 a gallon. At the high end, Californians are paying $2.65 and Hawaiians are shelling out $2.76.

The relative bargains at the pump might last a while, because global supplies are high and demand appears to be weakening. Oil prices fell Friday after the International Energy Agency predicted that demand will grow more slowly next year. The organization expects 2016 growth to be only two-thirds the size of 2015's increase.

Rising production, mostly from OPEC, is also pressuring oil prices. Iran, Iraq and other members of the oil cartel are trying to boost output as they dig out from economic sanctions and wars.

Crude oil futures fell $1.14 to close at $35.62 a barrel Friday on the New York Mercantile Exchange.

Tom Kloza, head of energy analysis for the Oil Price Information Service, said gas could go as low as $1.79 a gallon by winter, before rising again next year.

"I do think it will be much higher in the spring," maybe $2.75, he said.

Refiners often curtail production to perform maintenance on their plants during the slower late-winter and early-spring periods, and that is followed by the annual summer surge in driving. That yearly decrease in supplies and uptick in demand usually pushes prices up as the beginning of summer approaches.

While gas is at its cheapest price in more than six years, some suggest it should be even cheaper.

Jodie Gunzberg, the head of commodities research at S&P Dow Jones Indices, studied monthly prices for crude oil and gasoline going back to 1988. She found that the two generally went up or down about the same. But so far this year, she said, oil prices are down 29 per cent while gasoline is down only 16 per cent.

If gasoline prices had behaved exactly the same as oil prices this year, she estimates that consumers would be saving another 6 per cent at the pump -- about 12 cents on every gallon.

Consumers might not complain too loudly, however. Filling up a 20 gallon tank will cost an average $40.40 this weekend compared with $52 a year ago. And the Energy Department said this week that the average household can expect to spend $570 less for heating oil this winter, while a natural gas user should save 13 per cent.



Advertisements

Latest Economic News

  • Asian markets drop as investors look ahead to Trump speech

    Economic CTV News
    BEIJING - Asian stock markets were lower Monday as investors looked ahead to U.S. President Donald Trump's speech to Congress this week for details of promised tax cuts and infrastructure spending. KEEPING SCORE: Tokyo's Nikkei 225 index fell 0.9 per cent to 19,107.47 and the Shanghai Composite Index lost 0.5 per cent to 3,237.14. Source
  • Billionaire industrialist Koch leads fight to deregulate African-style braiding

    Economic CTV News
    PAWTUCKET, R.I. -- The billionaire industrialist Charles Koch and hair braider Jocelyn DoCouto have at least one thing in common. They are both part of a national movement to deregulate the business of African-style braiding. Source
  • What's in your chicken? CBC's Marketplace consumer cheat sheet

    Economic CBC News
    Miss something this week? We've got you. Here's this week's consumer cheat sheet. Get the Marketplace newsletter in your inbox every week. Sign up here. Inflatable mattress (prices) So, that bed you got for a bargain? That deal may be less dreamy than you thought. Source
  • Vatican stakes out copyright to Pope Francis' image

    Economic CTV News
    VATICAN CITY -- God's love may be free, but the Vatican says it has a copyright on the pope. Unnerved by the proliferation of papal-themed T-shirts, snow globes and tea towels around the world, the Vatican has warned it intends to "protect" the image of Pope Francis and "stop situations of illegality that may be discovered. Source
  • Is the Ivanka Trump brand boycott anti-feminist?

    Economic CBC News
    After Nordstrom dropped Ivanka Trump's fashion line this month, a Fox News host blasted women boycotting stores that carry the brand. In an opening rant on her show, Jeanine Pirro called the boycotters "loud, classless women" who were unfairly picking on a fellow female simply because they dislike her dad, U.S. Source
  • Last BlackBerry-designed phone with physical keyboard to hit stores in April

    Economic CTV News
    TORONTO -- Fans of BlackBerry's classic physical keyboard will have reason to celebrate when the last product designed in part by the former smartphone leader becomes available in April. The Waterloo, Ont.-based firm played a role in developing the KEYone, named for the return of the QWERTY keyboard that other smartphone designers have mostly long retired. Source
  • Final cleanup begins at Dakota Access pipeline protest camp

    Economic CTV News
    BISMARCK, N.D. -- The U.S. Army Corps of Engineers has moved into the evacuated Dakota Access pipeline protest camp to finish the cleanup started weeks ago by the Standing Rock Sioux Tribe. A Florida-based company has been hired to provide trash removal and environmental cleanup in the main Oceti Sakowin camp on the north side of the Cannonball River and the smaller Rosebud camp on the south side. Source
  • Appealing to millennials, Las Vegas gets e-sports arena

    Economic CTV News
    LAS VEGAS -- The arena has all the features that a professional sports venue needs: stands, warm-up areas for teams, massive screens for spectators and a broadcast platform for commentators. But what distinguishes this new Las Vegas arena is its dozens of video game consoles. Source
  • Warren Buffett says don't waste money on investment fees

    Economic CTV News
    OMAHA, Neb. -- Billionaire Warren Buffett wants investors to be wary of the high fees Wall Street routinely charges because of the damage they do to investment returns, and he emphasized his confident outlook in the U.S. Source
  • 'We always find a way': N.L.'s oil-dependent economy is hurting, but there is hope on the horizon

    Economic CBC News
    Dwight Ball, the affable pharmacist who has been Newfoundland and Labrador's premier for the last 15 months, said something remarkable Wednesday while swinging an axe through several hundred government jobs. "We're human, too. This impacts us," said Ball, who clearly has shown no relish for the more brutal parts of dealing with an oil-dependent economy during a collapse in petroleum prices. Source