Americans Saved Nearly $10B on Gas in Year's First Quarter
WASHINGTON, D.C. — Americans paid the cheapest quarterly gas prices in 12 years during the first three months of 2016 and saved nearly $10 billion on gas so far this year compared to the same period in 2015, according to AAA.
The national average price of gas during the first quarter was $1.86 per gallon, making it the cheapest quarter for gasoline since January-March 2004.
Gas prices are expected to remain relatively low compared to recent years, although average prices could rise another 25 cents per gallon by Memorial Day, AAA said.
The national average price as of March 31 was $2.06 for a gallon of regular gas, which was the lowest average going into April since 2009. Approximately 59 percent of U.S. gas stations are selling gas for less than $2 per gallon, and the most common price across the country is $1.999 per gallon. Average U.S. gas prices are about 36 cents per gallon cheaper than one year ago.
The nearly $10 billion, or 13 percent, that Americans have saved on gasoline so far this year compared to 2015 amounts to about $45 per licensed driver. These savings are in addition to the $120 billion that Americans saved in 2015 compared to 2014, which amounted to about $565 per licensed driver.
These savings are even more significant compared to several years ago; the most expensive first quarter ever was in 2012, when prices averaged $3.58 per gallon. Compared to that quarter, Americans have saved approximately $50 billion or $240 per licensed driver during the first three months of this year.
Relatively low oil costs and abundant petroleum supplies are the main factors behind the significantly lower prices.
These lower prices have motivated Americans to drive at record levels. Americans drove 3.1 trillion miles in 2015, which was an all-time high and 3.5 percent higher than in 2014, according to estimates by the U.S. Department of Transportation. The most recent estimates indicate Americans drove 240.7 billion miles in January 2016, the most ever for the month.
The Energy Information Administration estimated gasoline consumption was 395 million gallons per day in its latest four-week average, approximately 5 percent higher than the same period one year ago and the highest for this time of year on record. AAA predicts a strong likelihood that road travel will continue to increase in 2016 as long as gas prices remain low and there are no major economic problems.
Gas prices are now on the rise nationwide, a trend that drivers see nearly every spring. The national average price has increased 35 of the past 37 days, for a total of 35 cents per gallon. At this time of year, gas prices often increase 50 cents per gallon or more.
Most drivers are paying $4 to $9 more to fill up their vehicles during every trip to the gas station today than they did in mid-February. Gas prices could rise another 15 to 25 cents per gallon by Memorial Day in many parts of the country, but at those levels, seasonal prices would still be less expensive than in recent years, AAA noted.
The recent rise in gas prices is mainly due to higher oil costs, increased demand, refinery maintenance and the change to summer-blend gasoline. Oil prices are up by more than $10 per barrel since early February, and demand has risen as warmer spring weather arrives. This comes at the same time that many refineries conduct regular maintenance to prepare for the summer driving season. This causes them to produce less fuel, which can in turn cause higher prices.
Across the country, average gas prices vary by 95 cents per gallon. The five states with the cheapest average gas prices are Missouri ($1.83), New Jersey ($1.84), Oklahoma ($1.85), South Carolina ($1.87) and Alabama ($1.87), while the five states with the most expensive gas prices are California ($2.79), Hawaii ($2.59), Nevada ($2.44), Washington ($2.29) and Alaska ($2.29).