Gas prices are plummeting around the country, falling below $2 in many areas. Expert observers say the price could sink to $1 a gallon in some areas for the first time since 1999.
AAA and GasBuddy follow gas prices on a daily basis and both say they see no reason to think that prices below $2 won't soon be common in many states. Prices could even hit $1 in states like Alabama, Arkansas, Missouri, Oklahoma, and South Carolina, where prices already average around $1.75.
The collapse in pump prices is driven largely by Saudi Arabia's decision to keep its oil exports high, effectively destroying OPEC, which has for decades kept a tight lid on exports to keep prices sky-high.
Refineries and taxes
Another major factor is that refineries have been running well in most of the country. Refinery problems can cause major spikes in gas prices, as California drivers know only too well. Refinery problems are being blamed for keeping prices high in California, where AAA reports the average price of $2.87 is the highest in the nation -- 19 cents higher than second-place Hawaii, which is usually the market leader.
Gas taxes also play into the price at the pump. The national average state gas tax is about 49 cents per gallon, according to the American Petroleum Institute, but many states are well below that, including those that currently are enjoying the lowest gas prices. South Carolina, Missouri, and Oklahoma all charge around 35 cents per gallon, a 15-cent discount that can mean savings of $3 or more on a typical fill-up.
Of course, it's always necessary to remember that averages are just that and prices can vary widely in either direction based on a number of factors including how much consumers are willing to pay.
This irks many consumers, like Winslow of Smyrna, Ga., who thinks a local Chevron station must be a front for the Mob.
"Their gas station has always had much higher gas prices then any of the stations within 5 to 10 miles. What's going on? How can they survive charging so much more than any other gas station? Does anyone know? Are they just upfront for the Mafia?" Winslow asked in a review recently submitted to ConsumerAffairs.
Sorry, Winslow. It's more likely the station is in a convenient location, perhaps one where drivers value their time more than their money and are willing to pay more for the convenience of buying gas at that particular station.
The first rule of consumerism, after all, is that it pays to shop around. Retailers can charge whatever they please, and if consumers don't like it, they can go somewhere else. Drivers looking for the best price can find it at sites like AAA's Fuel Gauge and GasBuddy.