AAA: Average gas prices in Virginia under $2 a gallon

Gas prices continue to drop, falling for 16 consecutive days.  The national average price for regular unleaded gasoline reached $2.21 per gallon today, down five cents in the last week, and the average in Virginia is at $1.99 a gallon, down four cents from last week.

The domestic oil market is characterized by oversupply and the most recent reports from the U.S. Energy Information Administration (EIA) show a recent build in crude oil. Refinery maintenance is ongoing, making it likely that total domestic inventories of crude oil could hit another record-high, keeping the market oversupplied.  WTI opened the week falling below the mid-$40 per barrel range, and closed out Friday’s formal trading session on the NYMEX at $44.60, down $2.66 or six percent on the week.

“Prices at the pump have fallen consistently for the past two weeks, busing ever-closer to the much-anticipated $2 per gallon mark,” said Martha M. Meade, Manager of Public and Government Affairs for AAA Mid-Atlantic.  “Ample domestic oil supplies have been a driving factor in keeping a ceiling on gas prices.  “Barring any unanticipated disruptions in supply, and/or spikes in the price of crude oil, the national average could fall below the $2 per gallon threshold before the end of the year, a low not seen since 2009.”

More than half of the price at the pump is a reflection of crude oil prices, which have fallen steadily in recent weeks. Crude oil prices could shift lower because of weaker demand from a slowing Chinese economy and higher output from Iran, a member of the Organization of Petroleum Exporting Countries (OPEC). If the commodity prices shift lower, that would ease gasoline prices further, just in time for the holiday season.

CURRENT AND PAST GAS PRICE AVERAGES

Regular Unleaded Gasoline (*indicates record high)