For AJC
LATEST PRICE
$2.876
Wednesday’s average gas price per gallon in metro Atlanta, according to the AAA Fuel Gauge Report
For DDN and SNS
LATEST PRICE
$2.968
For JN
LATEST PRICE
$2.965
Wednesday’s average gas price per gallon in greater Cincinnati, according to the AAA Fuel Gauge Report
For PBP
LATEST PRICE
$3.074
Wednesday’s average gas price per gallon in metro West Palm Beach, according to the AAA Fuel Gauge Report
For AAS
LATEST PRICE
$2.712
Wednesday’s average gas price per gallon in metro Austin, according to the AAA Fuel Gauge Report
Economists say lower gasoline prices act like a tax cut, leaving more money for consumers to spend on other things. Consumer spending is 70 percent of the U.S. economy.
The Energy Department’s Energy Information Administration predicted in its latest short-term energy outlook that drivers will pay $2.94 per gallon on average in 2015, 45 cents lower than this year.
Based on expected gasoline consumption, that’s a savings of $60.9 billion.
The forecast calls for the national per-gallon average price in January to be $2.80, down from the current $2.92. Peak price is expected to be $3.05 in June, as the summer driving season begins, declining back to $2.80 by year’s end.
The peak average price for the current year was $3.70 on April 28, according to AAA. It said that on Tuesday, tThe national average had fallen for 48 straight days — the longest streak of continuous declines since 2—8 — and was at its lowest point since December of 2010. That was also the last full year when the average came in below $3 a gallon.
While late fall is often when the price of gas hits its low for the year, the EIA is now saying that these prices aren’t just a low point, but instead will be the norm next year.
The global price of crude has fallen by $35 a barrel, or 30 percent, since late June and closed at $80.38 Wednesday.
Oil production around the world has been strong in recent years. A boom in the U.S. has pushed domestic production up 70 percent since 2008. At the same time, demand for fuels is growing more slowly than expected in Asia and Europe because of weak economic growth, and one of the world’s largest oil producers, Saudi Arabia, has chosen to maintain its oil production instead of cutting back, as it has in reaction to past price declines.
The U.S. economy is faring relatively well, but more fuel-efficient cars and changing driving habits are keeping domestic gasoline demand low. The EIA expects demand to fall slightly next year despite the lower pump prices.
The EIA also slightly lowered its prediction for growth in U.S. oil production because lower prices will force some drillers to cut back. Production is expected to reach 9.4 million barrels a day in 2015, down from a previous estimate of 9.5 million barrels per day. Still, that would be an increase of 4 percent over this year and the highest domestic crude production since 1972.
About the Author
