Over the past four months, drivers have not been wondering how they will pay for gas, but what to do with their extra money after leaving the pump. Instead of trying to survive the week with half of a tank of gas, local residents are filling up their cars with the extra money left in their pockets from lower prices.
Throughout the last month alone, gas prices have dropped drastically, compared to previous years. According to AAA’s Daily Fuel Gauge Report, the average regular unleaded gasoline price in New Jersey on October 28 was approximately $2.85 per gallon, a remarkable change from October 15, clocking in at $3.01. Even in late September, the average price of gasoline was about $3.20 per gallon. Shockingly, only a few months prior, the highest average price for unleaded gasoline was close to $4.00 in July. This is an entire $1.00 per gallon decrease in the matter of three months.
Many new drivers who learned how expensive gas was earlier in the year are relieved by the lower prices. Commenting on the lower prices, Melanie Michalski said, “The lower gas prices have been awesome lately, leaving more money in my pocket to go out with friends!”
Many people are enjoying the cheap prices and hitting the road, not questioning why they are lower. When it comes to a reason why prices are so cheap, there’s more than one answer according to Csmonitor.com. Some deal with the United States, such as how the value of the dollar has increased, which allows more oil for the same price. Additionally, the U.S. has been producing more oil, which adds more into the world oil supply.
Besides U.S. reasons, there are also world reasons that contribute to lower gasoline prices. In areas of Asia and Europe, there is less of a demand for oil, which creates excess oil in the industry. In addition, Saudi Arabia has been pumping more oil than normal. The reason why is still unknown, but some reasons include pressuring Russia, the world’s largest oil producer, in order to make more money. Saudi Arabia itself is trying to defend its market by offering lower prices.
According to Csmonitor.com, Saudi Arabia could be trying to help us, or possibly hurt us. Whether it’s to help United States citizens pay less for gas or to ruin the U.S.’s tight oil boom, the reason cannot be determined. The general reason for lower prices is more supply than demand, but in this case, this is only a piece of the puzzle. Consumers will just have to enjoy these low prices, and hope they continuously decrease.