Drivers are getting some relief at the pump, with the average price of a gallon of gas falling to its lowest level in more than four years, according to new data from GasBuddy, an app that helps drivers find deals on fuel.
Gas now costs $2.95 per gallon on average, down 8.5 cents over the last week and 5.4 cents lower than a year ago, the data shows. That marks the lowest price at the pump since May 2021, the company said.
Data from AAA shows that the national average price for a gallon of gas is $2.99.
GasBuddy said the decline is due to strong refinery output and lower crude oil prices, as well as to softer seasonal fuel demand.
Domestic supplies of crude oil have been strong, with the U.S. producing an all-time high of nearly 14 million barrels a day as of September, according to the U.S. Energy Information Administration.
The Organization of the Petroleum Exporting Countries has increased oil production this year, another factor that has driven down fuel prices, according to Patrick De Haan, head of petroleum analysis at GasBuddy. The decline in gas prices shows the U.S. economy has stabilized after the COVID-19 pandemic and Russia's 2022 invasion of Ukraine, he added.
"All of the shock waves from both of those are basically gone," De Haan said.
While seeing gas prices dip below $3 may provide psychological relief for some, he emphasized that there were similar ups and downs in the last three years and that such seasonal fluctuations are normal.
"They're going to be lower in the winter, and they will inevitably go up next spring," the analyst said.
Prices drops ripple across U.S.
Still, GasBuddy said average prices have fallen in all 50 states in what it calls an "exceptionally rare and broad-based retreat."
The biggest weekly declines were in Ohio, Michigan, New Mexico, Oklahoma and Texas, which all saw gas prices dip at least 11 cents, according to GasBuddy.
In Michigan, drivers are now paying an average of $2.96 a gallon for regular unleaded gas, five cents below what they were paying the same time last month, CBS News Detroit reported Monday.
In some states, Americans are paying even less. In Oklahoma, Colorado and Texas, for example, gas is going for $1.99 per gallon or lower, according to GasBuddy.
The average price of diesel, at $3.72 per gallon, remains higher than gasoline, although it fell 5.5 cents in the last week, GasBuddy found.
The company relied on over 12 million individual price reports at more than 150,000 gas stations across the country to make its calculations.