Gas prices have dropped by almost 40 cents a gallon on average just in time for millions of Americans to travel for Thanksgiving, but why do gas prices rise and fall with the seasons, and what's the outlook for Christmastime travel?
The average price of a gallon of gas nationwide is $3.40, about 37 cents lower than a month ago. In November 2022, the national average price per gallon was 32 cents higher.
This could be good news for the 47 million people AAA estimates will travel by car this Thanksgiving. And the news will keep getting better for those traveling throughout the holiday season, according to analysts.
"For the seventh straight week, we've seen the national average price of gasoline decline. With cooler weather comes cooler gasoline prices, and as we inch closer to the Thanksgiving holiday, prices will continue to fall virtually coast to coast," said Patrick De Haan, head of petroleum analysis at GasBuddy.
This week, nine states are recording average gas prices below $3 per gallon, and the national average is the lowest since March. The states with the lowest prices are Texas ($2.86), Oklahoma ($2.98), Arkansas ($2.98), Louisiana ($2.97), Mississippi ($2.88), Tennessee ($2.99), Alabama ($2.98), Georgia ($2.88) and South Carolina ($2.95).
De Haan predicted the decline will continue for at least another couple of weeks, with California likely soon falling below $5, while more states fall under $3.
"Millions of Americans already have access to $2.99/gal or cheaper, and I expect that number to continue to grow this week," De Haan said.
Gas prices by region
Some states inevitably have higher gas prices than others. At the top of the list of expensive gasoline is California, with a still-high $5.12 price per gallon. One woman got increasingly creative in defeating the California gas prices by fashioning her dogs with a pull cart. Washington, Oregon and Nevada residents still see high prices today as well, at $4.57, $4.26 and $4.45 respectively. And on the East Coast, New Yorkers brave a high price of $3.69, nearly 30 cents above the national average.
Meanwhile, those in the South tend to see lower prices than the average American. Texans only pay $2.86 per gallon, with the rest of the region following with slightly higher prices still far lower than the national average.
"There are now thousands of gas stations selling regular below $3 a gallon and even a few that have dipped below $2," AAA spokesperson Andrew Gross said. "We still need to watch global events for the effect on oil prices, but for now, drivers will benefit from falling prices with every visit to the pump."
Why are gas prices falling?
Several factors are at play in the lower gas prices this season. Winter gasoline costs less due to shorter production processes, but Americans also tend to spend less time driving during colder months.
"Gasoline prices have long exhibited a seasonal pattern in which prices rise in the first half of the year and fall in the second half," University of Notre Dame economics professor Thomas Gresik told Newsweek. "This pattern is due to the change from winter blend gas to summer blend gas."
While in the winter, refineries tend to shut down or limit production for scheduled maintenance, they then begin production of summer blend fuel, hiking prices up. By mid-summer Americans tend to see prices fall, Gresik said.
"COVID disrupted this pattern, but it returned in 2022. This year the pattern has been present but muted," Gresik said. "Absent big oil price increases or unplanned refinery outages, the current downtrend in gasoline prices should continue until the end of the year."
Will prices continue to decrease?
Energy experts said prices will likely continue to drop in November and December as long as the violence in the Middle East does not spread to other countries.
"Expect these low prices to hang around through the holidays, unless oil prices suddenly spike or there's an unexpected disruption to fuel supplies," AAA spokesperson Mark Jenkins said.
Uncommon Knowledge
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Newsweek is committed to challenging conventional wisdom and finding connections in the search for common ground.
About the writer
Suzanne Blake is a Newsweek reporter based in New York. Her focus is reporting on consumer and social trends, spanning ... Read more
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