Low Demand For Gas Makes For Lower Prices at the Pump

A gas station sits empty in Houston, Texas.

A gas station sits empty in Houston, Texas.Photo: Brandon Bell (Getty Images)

In a world where everything seems to be getting worse, two things are getting better: gas prices and Top Gun movies. We’ll focus on gas prices for the purposes of this article, as this is Gas Price Watch. Anyway, the national average price for a gallon of gas now sits at $4.41, according to AAA. That’s down three cents from yesterday alone.

The lowering trend has been happening since prices hit their peak at $5.02 in mid-June. If you’re wondering what’s been fueling (heh) this trend, look no further than a very low demand for gas. AAA reports that new data from the Energy Information Administration (EIA) shows even though demand for gas increased slightly last week to 8.52 million barrels per day, it’s still 800,000 barrels per day lower than this time last year.

In fact, these consumption numbers are in line with the demand we saw in the middle of July 2020 – when Pandemic restrictions were pretty much at their height.

Something else that points to this idea of low demand is that our total domestic stockpile increased by 3.5 million barrels last week to 228.4 million barrels.

At the same time, crude oil prices are down.

At the close of Wednesday’s formal trading session, WTI decreased by $1.96 to settle at $102.26. Crude prices have declined this week as the market continues to worry that weakening demand, which was expected to remain robust throughout the summer, could continue to push prices lower. Additionally, EIA reported that total domestic crude stocks decreased by 500,000 bbl to 426.6 million bbl last week, just over 13 million bbl lower than the storage level in mid-July 2021.

All of this is leading to that easement we’re seeing at the pump. There are now seven states where the average price of a gallon of gas is at or under $4 a gallon. That being said, diesel prices still remain relatively high. Only two states in the entire country have average diesel prices coming in under $5 per gallon.

On that note, let’s take a look at the gas prices highs and lows around the country.

Here is the highest average gas prices in the country in order of highest price for a gallon regular:

Here is the lowest average price of gasoline in the country in order of lowest price per gallon of regular:

Enjoy your weekend, or else.