What goes up must come down right? Well according to today’s AAA Fuel Report Gage, the price for a gallon of regular gas is now at $3.703 and the downward trend is likely to continue.
The new price of $3.703 per gallon is down 20 cents from last month’s price of $3.970, yet it still soars above last year’s average of $2.701. According to an article by AOL’s Daily Finance, several different factors could push gas prices below $3.50 a gallon over the next several weeks.
The first reason for this dramatic drop in gas prices is that the U.S. economy no longer appears to be showing growth. Weekly initial jobless claims confirm that job losses continue to undermine the economic expansion. The most startling statistic refers to the fact that the number of people without jobs for more than 27 weeks has recently reached 6.2 million.
Another reason for the possible decline in prices at the pump results from the simple fact of supply and demand. As gas prices rose, many people found other methods of travel, carpooled, and/or didn’t purchase as much gas as one would usually would.
International demand has also had an effect on the U.S. gasoline prices. China’s economy has slowed somewhat, as has that of Spain and some of Europe’s largest nations.
Lastly, last month’s rise in gas prices seemed to be caused in part by low output from major oil producers. Experts believe that the price of gas will continue to fall within the next weeks.
Although low gas prices in this case demonstrate our strained economy, for now we all can afford to drive our cars at a cheaper cost.