Number of States With Gas Below $2 Drops to Zero

The national average for the price of gas has risen to $2.41, based on GasBuddy surveys. The level was $2.05 a month ago. The Financial Times reported that, over the course of February, oil prices may have risen at a rate last posted six years ago. The news for consumers may be worse than that. Oil traded as low as $44.37 this winter. Now, the price trades just below $50.

Other factors that affect low gas prices remain in place, which should give some hope to drivers. States with low prices are mostly those near refineries, which keeps transportation prices low. Also, most of those with gas prices below the national average have gas taxes well below average.

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The states with gas prices just above $2 sit primarily in the Plains. The price for an average gallon of regular is $2.02 in Utah, in Idaho at $2.03, and in Wyoming and Montana, $2.09. The only cities with gas prices below $2 include Provo at $1.98, Salt Lake City at $1.99 and Ogden at $1.99, all in Utah. These cities and states have such small populations that their effects on national averages are negligible. Most of the states with high gas prices have very large populations. The average price in California is $3.33, in New York $2.54 and Pennsylvania $2.53. Together, these states have 22% of the U.S. population.

The argument about the effects of low gas prices on the economy is that consumers get a benefit of over $100 a month, compared to when gas prices were $3.50 a year ago. That $100 helps consumer spending, which drives gross domestic product. This only works, however, it Americans do not save the money.

There may be some psychological effect when gas prices drop. The consumer believes his financial situation will improve in the future. That could turn to concern quickly.

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