Death and taxes aren’t the only things we can expect in life, at least not if you own a car. Yet, this year the oil industry is breaking its own cardinal rule and lowering gas prices just in time for a Thanksgiving holiday expected to bring record traffic. As Headlight.News reports, one chain will offer fuel for as low as $1.99 a gallon.
More than 55 million Americans will drive at least 50 miles to get together with family and friends for the long Thanksgiving holiday. Traditionally, they would be facing a surge in pump prices. But that’s not the case this year. In an unusual turnaround, as more travelers take to the road this year fuel prices have come down.
On Wednesday morning, one of the busiest days for holiday travel, AAA reported the average pump price for self-service regular had dipped to $3.281 a gallon. That’s down more than 6 cents from a week ago and compares with the $3.636 motorists across the country paid a year ago.
The average price is down below $3 a gallon for regular in 11 states, AAA said. And one major service station chain operating in the mid-Atlantic is offering fuel for as little as $1.99 a gallon through the end of next Monday.
“Good news” for motorists
“Drivers this Thanksgiving can expect cheaper gas prices,” Andrew Gross, a spokesperson for AAA, said in a statement. And there are signs that the downward trend could continue — though the ultimate direction is likely to be set by an upcoming meeting among members of OPEC.
With just a slight hiccup last week, oil prices have headed down mid-September, noted Patrick De Haan, head of petroleum analysis for tracking service GasBuddy.com. It could almost be described as a “freefall,” he said by phone Wednesday morning.
Currently, motorists are paying less than they have in 10 months for fuel, with self-service regular having hit a midyear peak of $3.85 a gallon.
“This is coming at time of a major holiday which is great news for economists since gas prices affect how Americans feel about the economy,” said De Haan.
$1.99 a gallon?
Motorists in 11 states — Texas, Oklahoma, Arkansas, Missouri, Iowa, Louisiana, Mississippi, Tennessee, Alabama, Georgia and South Carolina — can expect to pay less than $3 a gallon, on average, AAA and GasBuddy data agree.
But the biggest shock may come when motorists drive by one of the 670 stations operated by Sheetz in Pennsylvania, Ohio, Virginia, West Virginia and North Carolina. It is charging just $1.99 a gallon for unleaded fuel rated 88 octane.
That’s just below the rating for regular unleaded but can be use by all cars, trucks and crossovers sold from 2001 and beyond. However, since it is a blend of 85% gasoline and 15% ethanol, the EPA cautions that it shouldn’t be used in many older models, as well as motorcycles, boats, snowmobiles, commercial vehicles and for equipment like mowers and chainsaws.
Still, a figure of less than $2 a gallon hasn’t been seen on any widespread basis since the depths of the COVID pandemic when prices at some locations briefly dipped below a dollar.
The good news for motorists might also take some by surprise as conventional wisdom suggests holiday travel encourages oil companies and station operators to raise prices. While some might try to take advantage of the timing, De Haan stressed that gas prices are directly linked to the laws of supply-and-demand. Even with more than 55 million long-distance travelers, he explained, demand this week actually will be less than during a normal work week.
And while there had been concerns raised about another Mideast oil shock when Israeli troops flooded into Gaza, that hasn’t materialized.
While the situation “risked escalation,” De Haan said, “there’s been no impact on supply. The risk has actually been limited because Iran has said it won’t be drawn into a war.”
OPEC meeting delayed
Where fuel prices go during the rest of the annual holiday season is uncertain. Right now, experts see a further dip as being likely. But it all depends on a meeting OPEC has scheduled — and now delayed by four days.
That unusual postponement suggests there is “dissension” among the 13 primary members and 10 additional countries that are part of “OPEC+.”
“This is a critical meeting, the barometer of where gas prices go between now and Christmas and potentially beyond,” said De Haan, adding that “We could see gas prices drop below $3 gallon if OPEC can’t act decisively.”