This week, the average price of gasoline in the US fell to $3 per gallon, marking the lowest level since 2021.
Data from the American Automobile Association (AAA) shows that as of December 1 (Monday), at least 30 states had average retail gasoline prices below $3 per gallon. The current decline in crude oil prices, coupled with the introduction of winter-grade gasoline blends, has eased the financial burden for drivers ahead of the December holiday travel season.
"Refinery maintenance has largely been completed, and OPEC has increased oil production for December, putting downward pressure on prices," said Patrick De Haan of GasBuddy, a fuel price tracking platform, on Monday.
"These factors combined create ample conditions for gasoline prices to continue facing downward pressure in the coming weeks."
De Haan noted that some gas stations in the US Midwest are already selling fuel below $2 per gallon, and the number of such low-priced stations is expected to rise as the Christmas holiday approaches.
Oil futures, including Brent crude (BZ=F) and West Texas Intermediate (CL=F), have declined by 14% and 16% year-to-date, respectively, influenced by increased production from OPEC and its allies (OPEC+).
"OPEC's move to boost oil supply in 2025 appears aligned with the Trump administration's goal of lowering gasoline prices ahead of the midterm elections," wrote Citigroup analysts in a Monday report.
OPEC recently announced it would pause planned production increases by early 2026 due to ongoing price pressures.
Natasha Kaneva, an analyst at JPMorgan, recently projected that Brent crude prices could drop to $58 per barrel by 2026, with West Texas Intermediate trading $4 below that level.
The firm also expects oil prices to decline by another $1 per barrel by 2027.
"While it may sound repetitive, our message to the market has remained consistent since June 2023," Kaneva and her team wrote in the report. "Despite strong oil demand, supply is simply too abundant."
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