Topline
The average price of gasoline in the U.S. dropped for the third straight week, falling to $3.03 per gallon, according to GasBuddy—reaching the lowest average price for the month of March since 2021, as analysts cite uncertainty over the state of the economy, including President Donald Trump’s tariffs.
A driver fills up at a gasoline pump at a Shell gas station, Oct. 9, 2024, in Seattle.
Copyright 2024 The Associated Press. All rights reserved.Key Facts
The price fell 0.6 cents from last week’s average of $3.04, and is down 8.9 cents from one month ago and 36.7 cents from a year ago, hitting the lowest March price in four years, GasBuddy reported Monday.
Patrick De Haan, head of petroleum analysis at GasBuddy, said in a press release that caution around potential tariffs is “likely having a moderate impact” on prices.
While some analysts have predicted tariffs on imported Canadian oil could push prices higher in some U.S. regions, oil prices are also closely linked to the state of the wider economy: If tariffs lead to lower economic growth, demand for oil could sink as fewer people travel and buy goods, causing prices to fall.
De Haan also said the news that OPEC+, a coalition of oil-producing countries including Saudi Arabia and Russia, will “gradually begin restoring oil production after nearly two years of cuts” has added downward pressure on oil prices.
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Crucial Quote
“Concerns about the direction of the economy could have a major influence on fuel prices in the months ahead, especially with the high level of uncertainty surrounding tariffs,” De Haan said in the press release.
Where Is Gas The Cheapest?
Mississippi has the lowest average price of gas as of Monday at $2.60 per gallon, followed by Tennessee at $2.64 per gallon and Louisiana at $2.65 per gallon.
Where Is Gas The Most Expensive?
Gas is most expensive in California, where the average price per gallon is $4.65, followed by Hawaii at $4.57 and Washington at $4.03.
Tangent
The national average price of diesel gas fell 2.1 cents from last week and is at $3.61 per gallon. The most common price for diesel nationwide is $3.59 per gallon. It is the most expensive in Hawaii ($5.28) and California ($4.98), and least expensive in Oklahoma ($3.14) and Texas ($3.16).
Key Background
Gas prices dropped to these levels in March 2021 due to decreased travel demand during the COVID-19 pandemic, and they steadily returned to normal prices in the last four years with some fluctuation points, including a large spike in 2022 after Russia invaded Ukraine. But the spring typically brings an increase in prices, so the continued drop comes as a surprise for some. As recently as last week, traders and analysts were worried tariffs threatened by Trump, including a 10% levy on Canadian oil, would make gas prices rise, especially in the Northeast, parts of which largely rely on Canadian gasoline, Reuters reported. GasBuddy’s De Haan warned last Tuesday people in the Northeast could see as big an increase as 20 to 40 cents per gallon by mid-March. Trump paused the tariffs just two days after they took effect, though, until early April. Before the tariffs were paused, De Haan warned that “the real-world impact of tariffs won’t be to shift refining patterns, instead it will be to add costs throughout the system,” which would in turn make their way to consumers.
What To Watch For
GasBuddy has been warning of the usual seasonal spring increase in gas prices that has not yet hit. On Monday, it said the typical seasonal rise may be “considerably smaller than expected” if and when it does hit, but last week the company warned the delayed increase could “eventually push prices higher ahead of summer.”
Further Reading
Average U.S. Gas Prices Fall to Lowest March Level Since the Pandemic (GasBuddy)
Trump Bails On Most Mexico And Canada Tariffs For 1 Month (Forbes)
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