What is driving the drop in fuel prices at the pumps in Texas?
Gas prices are slowly dropping, but as demand wanes in the fall, they could easily hike back up.
Normal market forces — supply and demand — is driving the price of gasoline. Experts say prices will fluctuate like they always do, but for now, drivers are seeing some relief at the pump. More people are hitting the highways and global demand for crude oil has dropped, lowering prices.
Texas roads saw a record 3.1 million travelers over the Fourth of July holiday, according to the American Automobile Association..
The average price for gas in Texas is sitting at $4.29 a gallon, the largest week-over-week decrease we’ve seen so far this year, but still largely above the yearly mean, according to AAA data.
In the Fort Worth-Arlington area, the average price as of Friday is $4.28 a gallon. The weekly average a week ago was right around $4.51 and monthly was closer to $4.70.
Gas in Texas is the 6th-lowest price in America. South Carolina has the cheapest gas at $4.26 and California has the most expensive at $6.18.
In Texas, the cheapest average price of gas is in Laredo, where it costs $3.98, the only city in the U.S. with an average under $4. The most expensive average price of gas is in El Paso, where it costs $4.44.
Here’s what we know about gas prices and why they’re decreasing:
What’s causing gas prices to decrease?
One of the main factors of the decrease is crude oil prices going down, AAA spokesperson Daniel Armbruster said.
Fear of an impending recession is fueling a dip in demand for crude oil around the world, Armbruster said, taking with it crude oil prices. Lower prices for crude oil means lower gas prices.
Another factor helping prices stay lower is an increase in regional supply of oil.
Gas prices have been lower over the last few weeks, but it’s likely not something that could be considered a trend or have much staying power.
“We really just cannot guarantee at this time that prices won’t go back up once we get later into July,” Armbruster said.
Could gas prices increase again?
Yes, gas prices always fluctuate and there are many events that could change things.
For one, the ongoing conflict between Russia and Ukraine could send prices soaring again, because of the impact it has on global supply, Armbruster said. Hurricane season is also in full swing, with Texas typically seeing bigger storms towards the end of the summer and into fall.
July is also typically an exceptionally busy month for travel as people take vacations and getaways. There could be a bump in travel for people who might have not been able to go anywhere due to COVID-19 over the last couple years.
Going into the Fourth of July weekend, there was a nice jump in demand for gas, Armbruster said.
AAA is still sorting through the Fourth of July data, but they do know that a record number of people traveled in Texas by car. About 3.1 million Texans traveled 50 miles or more for leisure over the holiday weekend.
It all comes back to if there is enough supply to meet demand, Armbruster said.
What does the rest of summer 2022 look like for gas prices?
Drivers should plan for a possible increase in demand at the pump come mid-July, Armbruster said. This means the possibility that prices could spike back up going into fall.
With people going back to work or school there tends to be a decline in demand for gasoline following a busy summer driving season.
“But again, we’re living in unusual times,” Armbruster said. “Anything around the world could change at a moment’s notice that can impact the price of crude oil, and then therefore the price of gas here in the United States.”
What tips are out there to save at the pump?
While gas prices have gotten lower over the last few weeks, knowing other ways to save at the pump can help your wallet.
A few tips:
- Driver behavior — AAA studies have shown that driver behavior is the number one factor when it comes to fuel consumption. Adjusting behavior behind the wheel can help you save.
- Don’t accelerate too quickly — A “jackrabbit” start is when you accelerate quickly, eating up anywhere from 10 to 40% of fuel efficiency.
- Vehicle maintenance — Keeping your vehicle well maintained and serviced can help at the pump. Making sure the tires are aired up to the correct psi can be beneficial when on the road.
- Fuel rewards — Many grocery story or large retail chains offer fuel rewards at their gas pumps. It may only be a few cents off, but every little bit helps.
- AAA mobile app — Drivers can utilize the app to search for the cheapest gas prices around.
This story was originally published July 8, 2022 at 2:53 PM.
