Gas industry experts have revealed gas prices in the United States are set to drop by the end of the year. If proved correct, it will continue a trend of gas prices falling each year for the last three years.
According to Mark Jenkins of the Auto Club Group, gasoline companies have raised their prices over the past month or so. He tells the Daily News Journal that “demand is unusually high at a time when refineries are entering their maintenance season.” However, the average price across the country is around $2,29, which is the cheapest it has been on the same date since 2004. And, as the theory goes, that means we should see lower prices by the end of the year, too.
Gas prices tend to drop during the October period. There are fewer people driving their cars as the cold weather sets in. As opposed, of course, to the warmer summer months when fuel consumption on the roads is at its peak. It’s during this period that oil refineries and gas companies start on their maintenance programs, which adds a little to the price. But, given that the maintenance should be finished by mid-December, those prices should settle down once again.
In general terms, the price of gas has been dropping steadily over the past few years. Oil companies can pass on the savings they get from using new technology, such as detection software like Orcaflex and Orcina. Â It helps them save money on finding oil, and it is helping boost production levels. And then, there is China. With a lot of doubt about the Chinese economy causing concern in many different industries, for the car drivers it is good news. With the downturn comes even lower crude oil prices, and that means cheaper fuel at the pumps.
To compare this year’s figures, oil was averaging $45 per barrel by the end of the week ending September 27. At the same point during 2014, it was around $90 per barrel.
However, it’s not all sweetness and light, and the balance could change overnight, thanks to any number of factors. Firstly, OPEC may well cut back on their production. Secondly, the Chinese economy is not exactly a dead duck, and things could yet turn around for them. And, finally, oil from Iran may not make it to market. All of these scenarios, and more, could lead to a higher price tag at the gasoline pumps.
There are also some bets to consider from the U.S. Energy Information Administration group. They state there will be a general rise during 2016. They estimate a barrel of oil will cost around $53 next year, as opposed to an average of around $49 this year.
It doesn’t sound much, but it is. Consider that United States drivers racked up a whopping great 1.82 million miles on the road from January to July of this year alone.  That four or five dollars could make a big difference to the coffers of the oil industry. And, if gas prices do drop during December, there’s every chance that driving mileage will increase yet more next year.
