Gas Prices Drop Slowly in Nov. to Lowest Average Since July

AAA predicts national average will drop through end of year

MIAMI -- The national average price of gasoline dropped 11.9 cents a gallon (3.38%) in November, according to the AAA Monthly Gas Price Report: November 2012 Trends & December Outlook. This was the fifth monthly decline in gasoline prices this year, and Dec. 3's national average of $3.387 a gallon was the lowest since July 12.

"Most motorists managed to save a little money on gasoline just in time for holiday shopping," said Avery Ash, AAA spokesperson. "Prices unfortunately did not fall as quickly as most of us would have liked as a result of factors ranging from fighting in the Middle East to optimism over the 'fiscal cliff'."

The monthly average price of gasoline was $3.44 a gallon, which was the lowest monthly average since July. The national average price of gasoline declined for 25 days in November.

Gasoline prices nationally have fallen nearly 50 cents a gallon on average since Sept. 14, the day before much of the United States began the transition to winter-blend gasoline.

Gasoline prices remain at record highs for this time of year despite recent declines. The national average has broken the daily record high on 106 consecutive days for a total of 220 days this year (65%).

The average annual price of gasoline for 2012 will be the most expensive on record. The annual average to date is $3.63 a gallon, which is 12 cents more than the current record high set in 2011. Gasoline prices nationally would need to average about $2.05 a gallon through the end of the year to not break the record.

The average price of gasoline in areas hit hard by Hurricane Sandy, including New Jersey, New York City and Long Island, have returned to pre-storm levels now that gas stations are receiving regular fuel shipments. Average gasoline prices have dropped 18 cents a gallon in New Jersey, 21 cents a gallon in New York City and 26 cents a gallon in Long Island from peak prices following the storm.

AAA predicts that the national average price of gasoline will slowly drop through the end of the year and average between $3.20-$3.40 a gallon by New Year's Day. To date, the lowest daily average of the year is $3.28 a gallon from Jan. 1.

"Motorists may luck out and pay the lowest gas prices of 2012 by the time they celebrate New Year's," said Ash. "However, there is a small chance that pump prices could rise or remain flat as a result of rising oil prices and other economic factors."

For Dec. 3, 2012, the national average price of gasoline slowly dropped 11 days in a row to $3.387 a gallon, which is 3.6 cents less than a week before, but 10.7 cents more than a year ago.

The five states with the highest prices are: Hawaii ($4.047), New York ($3.863), Alaska ($3.792), Connecticut ($3.782) and California ($3.698). The five states with the lowest prices are: Missouri ($3.140), Texas ($3.143), South Carolina ($3.154), Oklahoma ($3.154) and Tennessee ($3.161).

Dec. 3's price is the highest on record for this calendar day and continues the streak of daily record prices that began on August 20.

Over the previous week, prices in every state except Missouri and Kansas fell, led by drops in the middle of the country. While these week-over-week declines were most pronounced in Ohio (-15.4 cents), Michigan (-12.3 cents) and Indiana (-11.7 cents), these states are also three of only four where motorists on Dec. 3 are paying more than they were on the same day last month: Indiana (+6.7 cents), Kentucky (+4.4 cents), Ohio (+2.3 cents) and Michigan (+1.3 cents).

Nationally, the largest one-week decline in pump prices was at the end of October when the national average dropped 14 cents. The largest increase during a similar seven-day period was 15 cents per gallon as prices surged higher to end February. Volatility has been more dramatic in the Midwest, where drivers have seen some of the largest price swings in the nation this year. Motorists in the region were squeezed to begin August, as prices rose some 40 cents or more per gallon in just one week, following regional production and distribution glitches. Prices in these same states had dropped about 25 cents in a week only a month earlier at the end of June.

While national retail gasoline prices declined each day during the past week, crude oil prices increased slightly, as market attention has focused on the impact of the looming U.S. fiscal cliff and the broader health of the global economy.