Car owners, especially those that have vehicles with poor gas per gallon efficiency, could not be happier as gas prices continue to fall reaching an average of $1 across US soil. This continuous plummet is due to both an over-saturated oil supply as well as general consumer behavior.
But this price drop does not apply to every state, to the dismay of consumers. Although oil barrel prices have dropped considerably since President Obama took office, reaching $32 per barrel of crude oil in comparison to the previous $147, in California, prices have remained more or less the same.
For Californians, the price cuts may have been somewhat felt over the past few months, but they are still much higher than other states, reaching $2.70 per gallon in comparison to the national average of $1. True, this might be attributed to the special blend of gas required by some Californian cars, but this in no way justifies the more than double price hike.
The fact that prices have jumped by 25 cents in the past month is most likely due to the massive imports that arrived on Californian soil, marked at 100,000 oil barrels, more than triple the number of the previous imports of 33,000 barrels. In addition to this, refinery efficiency has surged as well, even if by only 0,1%. The lessened demand during the months of January and February also helps in keeping the pressure on prices.
But according to market experts, this will more than likely change once the cold season is over. This can be easily seen by the general US public as well, not just in California, with prices dropping by a couple of cents each week.
The lowest point has been struck in Michigan, where the current low oil prices were joined by an ongoing gas war between to fuel providers. This effectively made the price per gallon reach around 47 cents, even if it only lasted for several hours. More than 500 cars were lined up in order to benefit from this cheap gas, urging police officers to arrive on the scene in order to fluidify traffic.
If we are to believe the estimates released by certain market analysts and experts, the fact that gas prices continue to fall reaching an average of $1 will not stop at all in the near future. We might even see a day where prices all across the US fall below $1 just like they did in the 90s. Only time will tell if this phenomenon will occur or not.