Gift at the pump: Cheapest Christmas gas since Covid
By Matt Egan, CNN
New York (CNN) — Drivers across the country will be unwrapping a welcome present this holiday season: Cheaper gasoline.
Americans will likely be greeted by the lowest Christmas Day gas prices since 2020 during the pandemic, according to GasBuddy, an app that crowd-sources pump prices.
GasBuddy told CNN it expects gas prices will average $3.01 a gallon nationally on Christmas Day. That would represent a modest dip from $3.10 last year and the Christmas Day record of $3.26 in 2021.
“Thankfully, filling up is more of an afterthought these days when people hit the road,” said Patrick De Haan, GasBuddy’s head of petroleum analysis.
Many Americans plan to hit the road to visit friends and family in the coming days.
An estimated 107 million people will travel by car this holiday season (from December 21 until January 1), according to AAA projections.
That would be 2% more than last year’s 104.5 million, though it is just shy of the 108 million people who traveled by car in 2019 just prior to Covid.
Car rental demand is especially hot this holiday season in Denver, Las Vegas, Los Angeles, Miami and Oahu, according to Hertz.
Travel slowed sharply in 2020 due to the pandemic, keeping gas prices very low. The national average that Christmas Day stood at just $2.26 a gallon, according to GasBuddy.
Even though gas prices have tumbled since spiking above $5 a gallon nationally in 2022, people are still paying more for fuel than they did prior to Covid.
For example, the national average on Christmas Day was just $2.54 in 2019 and $2.29 in 2018.
Of course, many Americans are making more money than they did before Covid, too. On a wage-adjusted basis, gas prices are relatively low.
In fact, GasBuddy found that the amount of work required to buy one gallon of gas in the United States recently fell to nine-year lows, excluding Covid.
As of December 8, the average American had to work 5.4 minutes to buy a gallon of gas, down from nearly 7 minutes in December 2021, according to GasBuddy. The only time since 2015 that it was lower was in 2020 at 4.9 minutes.
“The pump price may feel high, but you’re working less time to fill up your tank,” said De Haan. “People are nostalgic for those prices of 10, 20 or 30 years ago. I’m nostalgic to buy Coke at 99 cents, but I have the purchasing power to pay more now.”
President-elect Donald Trump has repeatedly promised to drive gas prices even lower. His energy plan calls for a drill-baby-drill mentality that would increase production sharply by slashing environmental regulations and ramping up permitting.
But the United States is already producing more oil than any country in world history. It’s not clear that US oil output can go drastically higher, nor that there is demand for significantly more supply given relatively low oil prices.
Despite ongoing tensions in the Middle East and the dragged-out war between the Russia and Ukraine, US oil prices finished last week at around $70 a barrel. That’s a far cry from the spike above $120 a barrel in 2022 after Russia invaded Ukraine.
“The price of oil has been coming down because of supply conditions,” Federal Reserve Chairman Jerome Powell said at a press conference last week. “The US is not feeling really the effects of geopolitical turmoil.”
Perhaps in an effort to boost demand for US-produced energy, Trump last week threatened to impose tariffs on France, Germany and other European Union nations unless they promise to make “large scale” purchases of US oil and gas.
GasBuddy had projected an even lower Christmas Day price of $2.95 per gallon.
However, a surprise increase in gas prices in recent days, primarily in the Great Lakes region, prompted De Haan to revise his initial forecast higher.
Still, drivers in 11 states are paying an average of less than $2.80 a gallon for gas, including Texas, Kansas, Oklahoma, Missouri, Delaware and South Carolina, according to AAA.
The-CNN-Wire
™ & © 2024 Cable News Network, Inc., a Warner Bros. Discovery Company. All rights reserved.
