‘Colos­sal col­lapse’ in gaso­line prices ex­pected for midterms

Some ar­eas could go as low as $2 a gal­lon

USA TODAY Weekend Extra - - MONEY - Nathan Bomey

Gaso­line prices are ex­pected to plunge sharply in the fi­nal days lead­ing up to Tues­day’s midterm elec­tions, po­ten­tially near­ing $2 a gal­lon at some sta­tions in low-tax states.

The sud­den respite at the pump comes from sharply lower oil prices and de­clin­ing whole­sale gas prices.

Oil Price In­for­ma­tion Ser­vice an­a­lyst Tom Kloza said it could amount to a “colos­sal col­lapse” in prices for con­sumers: from a $2.78 na­tional av­er­age on Fri­day to as low as $2.50 by Tues­day.

“There’s the pos­si­bil­ity you could see some prices flirt with $2 a gal­lon in the next 10 days or so in some of the low-tax ar­eas,” Kloza said. “For now it’s go­ing to be a great break.”

The break comes af­ter gas ap­proached four-year highs in Oc­to­ber, top­ping a na­tional av­er­age of $2.90 a gal­lon at one point. Prices have al­ready fallen by 6 cents per gal­lon over the last week, ac­cord­ing to AAA. But they re­main 27 cents higher than a year ago.

About 500 sta­tions through­out the coun­try were charg­ing less than $2.25 as of Thurs­day. Kloza pre­dicted that fig­ure could top 1,000 sta­tions by Tues­day.

Of the 48 con­tigu­ous states, Delaware’s gas was cheap­est as of Fri­day at $2.47 a gal­lon, ac­cord­ing to AAA. Cal­i­for­nia’s was most ex­pen­sive at $3.77.

U.S. oil prices have fallen about $13 per bar­rel from their Oc­to­ber high, clos­ing Fri­day around $63.

One key rea­son: Ris­ing oil pro­duc­tion through­out the world is caus­ing stock­piles to build up.

To be sure, the respite in gaso­line prices may be tem­po­rary. Pres­i­dent Don­ald Trump has ordered the U.S. to reim­pose cer­tain sanc­tions on Iran in the com­ing days af­ter they were lifted as part of a nu­clear deal ar­ranged by Pres­i­dent Barack Obama. If Ira­nian oil ex­ports fall, oil prices could jump, caus­ing Amer­i­can gas prices to in­crease as well, said Patrick DeHaan, se­nior pe­tro­leum an­a­lyst at fuel find­ing app GasBuddy.

Newspapers in English

Newspapers from USA

© PressReader. All rights reserved.