As demand for oil goes down, gas prices follow. According to data from price tracker GasBuddy, the average U.S. gas price could drop below $3 per gallon by Christmas, The Hill reported, the lowest since February.
After declining 22.7 cents per gallon over the last month, the current national average is around $3.50 per gallon. But, GasBuddy data indicates this could go down to $2.99 by Christmas. This is only the expected national average, and some parts of the country are also doing better than others. For instance, The Washington Post reported that Californians are paying an average of around $5 per gallon of regular gas.
“All the metrics look very positive for motorists as this week is likely to continue seeing falling gasoline prices, with many areas falling to the lowest level since Russia’s invasion of Ukraine in February,” said GasBuddy’s head of petroleum analysis Patrick De Haan, per The Hill.
The price of gas is reflected in the declining demand for gas and oil around the globe as countries prepare for a recession and drivers cut back to save more money. Some key U.S. oil refineries are also back online, helping to further reduce prices at the pump. The Washington Post also noted that turmoil in China and new coronavirus lockdowns are sparking protests across the country — and the possible economic fallout could turn oil traders bearish.
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Emma Rasiel, a professor of economics at Duke University, told The Washington Post that cheaper gas could give consumers the wrong idea and there is no indication that this is pushing the cost of other things down. Analysts say that manufacturers need to see continued low fuel prices before they adjust the cost of their products.
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This article originally appeared on GOBankingRates.com: Gas Prices Could Drop Below $3 Before Christmas Travel Boom as Global Consumption Drops