Thankful for Lower Gas Prices

National average expected to drop below $2 for first time since 2009

thanksgiving gas prices

GAITHERSBURG, Md. -- The national average for regular gasoline should dip to $1.99 per gallon by Thanksgiving Day, reaching its lowest level since March 2009. This would be almost 80 cents per gallon (CPG) less than the national average a year ago, according to gas-price information service GasBuddy, Gaithersburg, Md., and $1.29 per gallon less than in 2013.

In the last two weeks, the number of states with averages below $2 per gallon has more than tripled to 19, GasBuddy reported. Almost 60% of gas stations in the United States now sell gas below $2.

Over the course of the five days of Thanksgiving holiday travel, the lower gas prices should save consumers $1.5 billion.

Travel Expectations

In its Thanksgiving Travel Survey of more than 100,000 drivers, GasBuddy found that 30% of travelers plan to hit the road the Wednesday of Thanksgiving week. Twenty-five percent will travel on Thanksgiving Day—an 11% decrease from 2014. Another 23% said they would begin traveling two to three days before Thanksgiving.

“With gas prices plunging under $2 just in time for Thanksgiving Day, it’s a perfect reminder—some folks automatically expect gas prices to rise in advance of a major travel holiday. That’s become a popular misconception and this holiday exemplifies the point,” said Patrick DeHaan, senior petroleum analyst at GasBuddy. “November gas prices have slid significantly lower and holiday travelers will certainly be the beneficiaries.”

In the GasBuddy survey, more than 67% of travelers said they plan to drive more than 200 miles for Thanksgiving, and another 36% will travel more than 500 miles.

More Declines to Come?

GasBuddy expects prices to continue to trend downward through the remainder of 2015.

Tom Kloza, global head of energy analysis for the Oil Price Information Service (OPIS)/GasBuddy, told USA Today that the lowest state averages can be found in the Great Lakes region. These include Indiana at $1.803 per gallon, Ohio ($1.804) and Missouri ($1.860), according to GasBuddy figures. Drivers in the South are also paying among the lowest prices, led by Arkansas at $1.881 per gallon, Louisiana ($1.877) and Alabama ($1.841). California currently has the highest state average in the continental United States, at $2.740.

A huge surplus in oil is the main factor in the low prices. “This is a glut of crude,” Kloza told USA Today. “It’s a glut everywhere you look.”

In the 40 days of shopping time before Christmas, the typical driver should save about $75 thanks to lower gasoline prices, said Kloza.

“I don’t know what he or she is going to spend it on,” he said, “but it’s a substantial amount of money.”