Libyan Output, US Elections Send Gas Prices Lower

After spending several weeks at around $2.19 per gallon, the price of regular gasoline has now dropped for two straight weeks, reaching $2.12 last week. That was a drop of four cents per gallon lower than the previous week.

Crude oil dropped below $34 a barrel early Monday but recovered to around $35.70 in the late morning. Crude oil last traded at around that price in mid-June.

Rising production from Libya has risen to more than 800,000 barrels a day, after dropping to less than 100,000 barrels a day. The country’s political factions agreed in September to form a committee to resolve the disputes between the government and the Libyan National Army (LNA). Production has recovered faster than expected and could reach 1.3 million barrels a day early next year.

U.S. politics also is playing a major role in falling pump prices. Rising numbers of COVID-19 infections threaten the fragile economic growth of the U.S. economy as some states begin reimposing restrictions on reopening businesses.

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Patrick DeHaan, head of petroleum analysis for GasBuddy, commented:

In just the last few days, it feels like uncertainty over a potential legal fight over the U.S. election has also risen to near panic levels, all of which throws more uncertainty into the ring, keeping the U.S. from potentially having a clear leader to turn things around. For now, it’s virtually guaranteed that the national average will fall to under $2 per gallon in the next two weeks, so motorists need not be in a rush to fill their tanks.

The average cost at the most expensive 10% of stations stands at $2.99 per gallon, down two cents week over week, while the lowest 10% average $1.66 per gallon, down five cents. The median U.S. price is $1.99 per gallon, five cents lower than last week and about 12 cents lower than the national average.

The five states where drivers are paying the most for gas are Hawaii ($3.43), California ($3.22), Washington ($2.69), Nevada ($2.58) and Oregon ($2.50).

The five states where gas is cheapest are Missouri ($1.76), Oklahoma ($1.77), Mississippi ($1.78), Texas ($1.80) and Arkansas ($1.82).

Compared to last month, the national average is up by 6.5 cents per gallon, and compared to last year, prices are down by nearly 49 cents per gallon.

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