Gas Prices Are At Their Lowest Seasonally Since 2004

By MARC TORRENCE (Patch National Staff)

Gas prices are dropping. And dropping and dropping and dropping.

The U.S. average price at the pump Monday was $2.59 per gallon, the lowest it’s been in late August since 2004, according to a report from the American Automotive Association. Last year at this time, a gallon of gas cost $3.43.

And prices are expected to keep dropping.

GasBuddy estimates that by December, the national average will be less than $2 per gallon.

California has the highest average of any state in the country at $3.47. South Carolina has the lowest at $2.11 per gallon.

You can find the price of gas in your area by typing in the zip code here:

The low prices are the result of an economic theory as old as time.

“It all goes back to supply and demand,” Patrick DeHaan, GasBuddy’s senior petroleum analyst, told Patch. “At the end of the day, we are just awash in crude oil. U.S. oil production remains very high, some of the highest production we’ve seen since the ‘80s.

“Even in light of some of these low prices, oil companies in the country have continued to produce.”

China’s recent recession has also played a major part in the dip in U.S. gas prices, DeHaan said. As China’s gas consumption goes down, it leaves even more supply for the rest of the world.

And if President Obama’s Iran deal goes through, he said, and sanctions against the country are lifted, there could be even more oil in the U.S., leading to a further decrease in price.

“Iran has been storing oil and seems very anxious to start selling oil to an already supplied global market,” DeHaan said. “So you have all these downward pressures on crude oil.”

DeHaan doesn’t expect the trend to reverse any time soon, either.

“We’re talking about low prices sticking around for months,” he said. “When you look at it, these low prices have stuck around all summer, really.”

Photo via Shutterstock