Gas Prices: How Low Can They Go?

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Gasoline Prices (This Friday, Sept. 27, 2013, photo, shows a gas pump in Montpelier, Vt.  The national average price of gasoline
Toby Talbot/AP
By Kate Rogers

Good news for drivers: Gas prices have dropped off two cents per gallon on average in the past two weeks and prices are expected to dip further before the end of the year.

According to the Lundberg Survey of Fuel Prices, the average price of a gallon of regular unleaded gasoline is $3.66 across the country, midgrade fuel is $3.56 a gallon and premium is averaging $3.71 a gallon. Diesel will cost drivers an average of $3.91 per gallon.

GasBuddy.com's Patrick DeHaan says he wouldn't be surprised to see prices drop even more in November and December. The drop in prices could be good news for both consumers and retailers: It will be cheaper for consumers to get around during the holiday rush and retailers stand to benefit from shoppers not feeling the pain at the pump.

DeHaan says the recent drop off is likely tied to the 16-day government shutdown, which ended on Oct. 17, but he notes the drop off in gas prices have been holding steady recently.
Total decline over the past six weeks has been 22.19 cents per gallon, according to Lundberg.

"It's hard to explain exactly why the decrease is stalled, it could be concern over the government shutdown," DeHaan says. "[Oil] prices are at $99.75 a barrel, and if they close at under $100, it will be the first time in 111 days."

Prices have touched $100, but haven't dipped below that level, DeHaan says, adding there may be room for a greater fall before years' end.

"[Gas] prices will likely bottom out in mid-December, I see the national average within an arms shot of $3," he says. "It may also add to the reasoning that gas prices will decline if the concern is that retail is sluggish, that means folks will spend less to get out to those locations to shop. [A price drop] means good news at the gas pump."

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