Energy

$2 Gasoline Comes Back

Douglas A. McIntyre

Published: November 30, 2023 1:35 pm

Gasoline prices have dropped nationwide to $3.25 for a gallon of regular. That was down from $3.49 a month ago. The forecast is that prices will continue to fall as oil prices drop. However, the nationwide average price is misleading. Gas prices vary from state to state. In one place in the country, gas has dropped to $2 a gallon. (Check out the price of gasoline through the decades.)

Oil, state taxes and proximity to refineries drive the differences in states’ gas prices. In Oklahoma, it is $2.68 on average, based on GasBuddy data. At the far end of the spectrum, it is $4.80 in California.

Oil prices are at $79 a barrel and falling, which benefits all states. The per-barrel price was $90 in September. Barring a major geopolitical blowup, oil supplies are plentiful.

Louisiana benefits from low gasoline taxes, which are currently $0.3841 a gallon, according to the American Petroleum Institute. That is against a national average of $0.5709. California’s number is $0.8655.

Proximity to refineries also benefits Louisiana drivers. The state is close to the large refineries south of Houston along the Gulf Coast. This also keeps gas prices low in Texas, Oklahoma and Alabama.

Just as gas prices vary from state to state, they also vary within states. GasBuddy shows the price of a gallon of regular in Monroe, La., as $2.00, which is close to that in several other places.

Why does Monroe have a price at such a low level? Refinery proximity helps. However, it may also be a promotion to draw in drivers. But why make less than necessary in terms of margin?

Gasoline prices in some parts of Louisiana are a mystery. However, prices in that state and others are falling, and $2 gas may become the rule and not the exception.