Gas prices down in ’13, set to go lower in ’14

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NEW YORK (CNNMoney) — Drivers fueled up for the lowest price in three years during 2013, according to AAA, and even lower prices are expected in 2014.

The motorist group reports that the national average price for a gallon of regular gas was $3.49 in 2013. That’s down about 12 cents from the record price set in 2012 and is a couple of cents cheaper than 2011.

“It was a relief to see gas prices decline in 2013 following record-breaking pain at the pump in recent years,” said Avery Ash, an AAA spokesman. “Our hope is that prices will continue to fall as cars grow increasingly fuel efficient and refineries expand production to take advantage of the recent boom in North American crude oil.”

Gas prices down in '13, set to go lower in '14

Photo credit: CNNMoney

Tom Kloza, chief oil analyst for the Oil Price Information Service, which tracks prices for AAA and GasBuddy.com, said the boom in North American oil production in recent years has given the continent the lowest price for crude oil anywhere in the world.

He said gasoline consumption has been dropping on an annual basis in recent years as well, although there has been a rise in demand the last four months of the year. That has lifted prices by about 10 cents a gallon from the low of the year on Nov. 11, when the national average was just under $3.20 a gallon.

Kloza said the rise since then is actually good news in that it’s a sign of a stronger economy. Lower unemployment means more people need to drive to work. More also are spending money to take vacations. But even if the economy continues to improve, Kloza agrees that 2014 should see lower prices on average due to continued increases in production.

The daily average price has stayed above the $3 mark for the last three years, although there were a dozen states where the average price fell below $3 at some point in 2013.

Kloza said the uneven use of North American crude by refineries in different parts of the country is leading to volatile prices in different regions, and he expects that to continue in 2014. He said access to oil from Canada and the U.S. Great Plains will help prices in the middle of the nation.

AAA said South Carolina was the state with lowest average price for the year at $3.24 a gallon. The highest average state price was in Hawaii at $4.24, with California having the highest price in the continental United States at $3.89.

Casper, Wyo., was the metropolitan area that enjoyed the lowest average price at $3.15, with Wailuku, Hawaii, having the highest at $4.64.

By Chris Isidore

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1 Comment

  • Terry Roberts

    The demand for more gas means more money at the pump. So as more people go to work, the ones that were working extremely low paying jobs that do have to drive get hurt because they can’t afford to go to work because of gas prices. If they are making a profit from low gas sales, you know they are making it in high gas sales. They just want to be more greedy, but in reality they are making more because of volume. Now their excuse is more expenses when they refine more gas, but the volume really offsets that and if they are paying a lot of overtime then they are mismanaging because they should be hiring more workers to eliminate the overtime. They know this but keep us under their thumbs. Why is there not a real investigative reporter out there working on this? Are you all in cahoots with the gas makers?