The national average price of gasoline has continued on a downward trend after dropping below $3 a gallon a week ago, sinking to their lowest level since 2021. The median U.S. gas price is now $2.79 per gallon, with the national average 4 cents lower from a week ago. However, prices vary widely by state, with motorists in Oklahoma paying $2.366 per gallon compared to $4.469 in California. Diesel prices have seen an even steeper decline, with the national average price of diesel currently standing at $3.671 per gallon, 5.1 cents lower than a week ago.
“Gas prices continued to decline in most states last week, while some price-cycling states saw temporary spikes to restore margins,” said GasBuddy’s Patrick De Haan. “With the national average falling further, we’re now at multi-year lows heading into Christmas. Diesel prices are also easing, and in the cheapest cities, averages have dipped into the low-$2 range, with a few stations still offering gas under $2 per gallon. Barring any major disruptions, prices are likely to stay relatively low into the new year.”
Global oil prices are currently driven by a tug-of-war between geopolitical risks (Russia sanctions, Middle East tensions) pushing prices up, and fears of economic slowdown/oversupply (slower China demand, OPEC+ returning barrels) pulling them down, all while investors anticipate U.S. interest rate cuts to boost demand, creating volatility but generally range-bound. Key factors include supply uncertainty from sanctioned Russian oil, potential U.S. policy shifts on Venezuela, and varying demand growth in Asia vs. OECD nations. Brent crude for February delivery was trading at $62.79 per barrel at 12.20 pm ET in Monday’s afternoon session, down 1.51% on the day while WTI crude for January delivery fell 1.53% to trade at $59.12 per barrel.
“With the Ukraine/Russia peace deal negotiations still ongoing, oil prices remain rangebound with the lack of large onshore oil inventory builds. This week will see the energy agencies releasing their oil market report, with likely demand upward revisions due to stronger U.S. oil demand growth,” said Giovanni Staunovo, UBS commodities analyst.
By Alex Kimani for Oilprice.com
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