Gas prices approaching lowest level since 2008
FARGO--The price at the gas pump is falling within reach of a low last seen in December 2008, and analysts expect low prices to continue.
AAA projects average gas prices in North Dakota will hover throughout 2016 in the $2.10 to $2.20 range. It’s much lower than that now in many places in the region.
The average price of gas in Fargo on Monday was $1.58 per gallon, down from $1.65 a week ago and $1.70 a month ago, according to AAA's daily fuel gage report.
The current pump price is only a bit higher than the $1.54 that motorists paid on Dec. 13, 2008, the lowest price in Fargo for at least a decade, according to AAA's gas price tracker.
By comparison, Fargo recorded its highest average price on May 20, 2013, when it cost $4.18 per gallon to fill the tank, according to AAA.
Low gas prices--the result of a supply glut as well as weakening global demand--should continue through the winter, then edge up with warmer temperatures, but still remain low, Gene LaDoucer, a spokesman for AAA in North Dakota, said Monday.
"We expect them to remain low through the end of February, perhaps early March, then expect them to turn higher," he said.
That would fit a typical seasonal pattern, driven by higher gas usage as people travel more, as well as refineries' shift to summer driving blends, which cost a bit more, LaDoucer said. Also, refineries sometimes shut down for maintenance in summer, which can cause regional price increases.
"Longer term we expect gas prices to remain at significantly reduced levels," LaDoucer said.
The $2.10 to $2.20 price range, LaDoucer said, is significantly below the average that prevailed through much of the past five years, with prices above $3 a gallon, he said.
Last year the average price in North Dakota was $2.35 a gallon, according to AAA.
If oil prices are nearing a bottom, LaDoucer said, gas prices probably won't trend much lower.
Though most forecasts call for sustained low crude oil and gasoline prices, long-range forecasts are difficult. LaDoucer refrained from trying to predict prices next year.
"It's hard to say what's going to happen a year from now," he said.