Future49 member Bob Griffin discusses the value of natural gas in Alaska amid the Trump administration’s plans to open up millions of acres to the new oil law.
Gasoline prices could fall below the $3 mark for the first time in four years as fuel prices swell to lower prices, according to the latest analysis by AAA.
The national average price of a gallon of gasoline fell to $3.05 last week due to lower crude oil prices, lower demand for gasoline and a cheaper winter at the pump, according to AAA. The last time the national average reached $3 per capita was 2021.
As of Tuesday, West Texas Intermediate (WTI) futures are trading at around $57 per barrel.
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Cheap oil prices have benefited consumers as crude makes up a large portion of galloline costs. It currently costs 51% of the price of natural gas, according to the Energy Information Administration (EIA).
The last time the national average reached $3 per capita was 2021. (BANDON BELL/Getty Images)
Aaa’s report aligns with projections released by the EIA in September, which expects the US average gasoline price to be $3.10 per barrel this year.
Andy Lipow, President of Lipow Oil Associates, pointed to market fundamentals as the main driver, telling FOX Business that gasoline prices are tracking lower oil prices.
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Lipow said that for the past two years, OPEC + has been restoring its voluntary cuts, adding to the market. At the same time, Lipow said domestic production touched record levels of more than 13.6 million barrels per day with additional supplies from Brazil, Guyana and Argentina.
The national average price of a gallon of gasoline dropped to $3.05 last week. (Daniel Acker/Bloomberg via Getty Images)
“The result is powder,” Lipow said.
He pointed to EIA’s global supply estimates which show that supplies in 2025 are expected to grow by three million barrels per day while demand grows by only 700,000 barrels per day.
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“Oil prices have fallen sharply in the past few weeks as the market sees a growing surplus in ongoing storage -” said Lipow, adding that China has been increasing by filling strategic storage low at these low prices.
It eases tensions around the world, especially in the Middle East, helping to lower the price of oil. (Patrick T. Fallon/AFP via Getty Images)
Lipow expects the national average price of gasoline to hit $3 each next day.
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Phil Flynn, Price Future Group Analyst and FOX business provider, confirmed President Donald Trump’s political relationship with OPEC member countries that increase oil production faster than originally planned.
He also noted that reducing global conflicts, especially in the Middle East, helps reduce the price of oil. Regional instability can influence oil markets, because traders tend to react to regional risk.
