Prices of gasoline in the United States, as well as other countries around the world, are falling dramatically due to the near-global coronavirus lockdown and a price war between Russia and Saudi Arabia.
Market Watch reports that many Americans are seeing gas prices drop to less than $2 a gallon and before long, certain areas, particularly in the Great Lakes region could soon see prices fall to 99 cents a gallon. At least one station in Kentucky is already selling gas for 99 cents a gallon.
Speaking with CNBC, vice chairman of HIS Markit, Daniel Yergin, said the main reason for falling gas prices is the simple fact that people aren’t driving and are instead staying at home to stop the spread of Covid-19.
The AAA reports that as of Monday, consumers in the U.S. were still paying an average of $2.12 per gallon but that figure is expected to fall and fall fast.
“I expect that the national retail average for gasoline will be below $2 a gallon by April, and I believe we’re on our way to $1.70 as the national average by the middle of April, and we could go lower if this continues,” president of Lipow Oil Associates, Andrew Lipow said.
Lipow believes that demand for gasoline in the United States has already dropped by about 25 per cent nationally and said that a number of refineries are reducing their production by 20 per cent. Global head of energy analysis at Oil Price Information Services believes things could be even worse stating that the U.S. used 9.7 million barrels a day of gasoline last week and that this could soon fall to about 5 million barrels a day.