If oil prices remain low, drivers can expect a parallel decline in pump prices throughout the holiday season.
The average price of gas dipped to $3.10 for the week ending December 14, a ten-cent drop from the week prior, according to the latest report from AAA. Pump prices on average are 25 cents less than a month ago and 11 cents less than a year ago.
"AAA is forecasting that roughly 104 million Americans will drive to their holiday destinations this year, and they will be greeted with the gift of falling gas prices," AAA spokesperson Andrew Gross said. "With pump prices falling slowly each day, it is likely that the national average will slide below $3 per gallon by the end of the year."
The West Texas Intermediate (WTI) – an oil price benchmark – increased by 86 cents to $69.47 at the close of Wednesday’s formal trading session. Gas demand climbed from 8.47 to 8.86 million barrels per day last week, according to new data from the Energy Information Administration (EIA).
Oil prices rose Wednesday after the Federal Reserve announced its plans to leave interest rates unchanged through the end of 2023 and potentially lower rates up to three times in 2024, AAA noted.
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For a continuous three-month period, the average national gas price has decreased and now has dropped to its lowest point of 2023, according to a report from GasBuddy.
"For the 12th straight week, or three straight months, the national average has continued to decline, now at its lowest level of 2023 heading into the prime of the holiday season as oil prices continue to struggle amidst cooling demand," Patrick De Haan, the head of petroleum analysis at GasBuddy, said.
As gas prices continue their descent, drivers are experiencing significant cost savings at fuel stations.
"With nearly 80,000 gas stations in the U.S. now priced below $3 per gallon, and 23 states also seeing average prices of $2.99 or less, motorists are getting substantial relief at the pump in time for the holidays," De Hann continued.
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A higher number of Americans are predicted to choose driving as their means of transportation this holiday season, according to a AAA Newsroom report.
"AAA expects nearly 104 million people will drive to their holiday destinations, an increase of 1.8% compared to 2022," the report said. "This year’s projected number of drivers is the second highest on record after 2019 when 108 million drivers hit the road for the holidays."
This year will see a 2.2% uptick in the total number of domestic travelers compared to the previous year, representing the second-highest year-end travel forecast since 2000, when AAA started tracking holiday travel.
AAA noted that motorists can anticipate paying a similar or lower amount per gallon of gas compared to the 2022 holiday season.
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