AAA: Labor Day Gas Prices Lowest Since 2004

WASHINGTON, D.C. — The majority of U.S. drivers will pay the lowest gas prices since 2004 for the busy Labor Day weekend this year. The national average price of gas is currently $2.44 per gallon, which is 99 cents less than one year ago, according to AAA's Monthly Gas Price Report.

U.S. consumers should save more than $1 billion on gasoline during the holiday weekend compared to 2014. Many drivers will save approximately $15 to $25 on every trip to the gas station, reported AAA.

Due to high supply and lower crude oil costs, average gas prices have dropped approximately 37 cents per gallon since the 2015 peak price of $2.80, which occurred on June 15. In August, the average price was $2.60, marking the lowest average for the month since 2005. This was also about 15 cents lower than the average price in July.

More Americans are taking advantage of these prices to travel more. U.S. driving topped 1.54 trillion miles during the first half of 2015, according to estimates by the Federal Highway Administration.

Still, despite recent decreases, average gas prices are around 41 cents per gallon more expensive than the lowest daily average in January due to high demand, continuing refinery problems and the higher cost to produce summer-blend gasoline. The average price of diesel was cheaper than gasoline for six days in August for the first time since 2009, due to seasonal factors and the elevated cost of gasoline.

If the cost of crude oil remains low, gas prices in many parts of the country could fall below $2 per gallon by Christmas. Other factors include a seasonal decline in driving, the Sept. 16 switch to cheaper winter-blend gasoline, and the fact that gas prices generally drop after Labor Day, which concludes the summer driving season. Higher crude oil prices, unexpected refinery problems or a major hurricane striking the Gulf Coast could cause gas prices to rise.

As of Sept. 3, more than 5 percent of all U.S. gas stations were selling gas for less than $2 per gallon, with that figure on the rise. On this day in 2014, no stations sold gas for less than $2 per gallon, reported AAA.

The average price of gas in South Carolina is $2 per gallon and will likely fall below that mark before Labor Day weekend begins. Average prices in Alabama and Mississippi may also fall below $2 over the next week, AAA predicted. The last time any state had an average below $2 per gallon was Feb. 26, when Idaho and Utah were below that price.

The states with the lowest average gas prices are South Carolina ($2), Alabama ($2.06), Mississippi ($2.06), Tennessee ($2.14) and Louisiana ($2.16).

The five most expensive state averages are Alaska ($3.40), California ($3.31), Nevada ($3.11), Hawaii ($3.08) and Washington ($2.92).