The lowest gas prices in five years has been a welcome relief for stepping back weary American drivers as prices have dropped to as low as .50 a gallon in some areas. That new price level translates into a allowance of more than 60% from last summer's record high prices. Cheap gas is back, giving real relief to tens of millions of drivers, but have prices bottomed out?
The drive to lower gas prices has come promptly and forcefully. Just a few months past gasoline was selling for .50 a gallon higher than current rates, but the trend toward lower prices was already set in motion. Mid-season storms slowed that action, but when previously cut gas lines were repaired, prices soon began to slide.
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The lowest prices for a gallon of regular gasoline can currently be found over America's mid-section, from the upper Midwest down straight through the plains and all throughout Texas, a major oil producing state. In a modern seek of pump prices via GasBuddy.com, it was proven that stations in Corpus Christi, Kansas City, Oklahoma City, Des Moines, Dayton, and elsewhere were selling regular gas for under .40 a gallon, the lowest prices some habitancy have seen in many years.
Behind the drive to lower pump prices is the cost of a barrel of oil. In Summer 2008, oil prices spiked, topping out at 7 a barrel, which sent pump prices above a gallon approximately everywhere, even above the level in Hawaii. Consumer demand, speculators, and Opec were all blamed for the increase, but it appears that the current global economic downturn is the driving force behind lower gas prices today.
Although Opec has met any times to cut production, oil prices continued to drop. It was only over the past month that prices have stabilized, even rising by about ten percent as production was realigned to meet demand. This could bode poorly for drivers next summer as increased interrogate and decreased supply could send prices skyward again.
The best case scenario would be for producers and consumers to come up with a middle ground price, one where sellers could still make a behalf and buyers would be able to afford a fill up without busting their budgets. Oil trading between and a barrel has been recommend as the right price range, but we're well below that right now with few consumers truly desiring to see any sort of increase.
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