With U.S. oil prices down to a six-year low and a major refinery outage fixed, gasoline prices have begun to dive in most parts of the country, and gas for less than $2 a gallon is easy to find again in the Southeastern states. The AAA Daily Fuel Gauge Report listed the national average for regular gas at $2.53 a gallon as of Thursday morning — down 12 cents from a week ago and the lowest it's been in late-August since 2004.
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A distilling unit at a BP refinery in Whiting, Ind., that had been idled since Aug. 8 because of an unspecified breakdown was restarted Tuesday. The outage at the refinery reduced the supply of gasoline in neighboring states at least temporarily, and caused the wholesale price of gas to shoot up. Pump prices soared by as much as 80 cents a gallon in just a couple of days as a result. BP said in a statement that production at the refinery would be "ramping up over time" and that the company "continues to meet its contractual fuel supply obligations."
That news quickly helped lower pump prices in the Great Lakes states, which bore the brunt of the price spikes caused by the refinery issues. Average prices for regular gas the past week fell by 22 cents in Wisconsin, 24 cents in Illinois, 26 cents in Indiana and 29 cents in Michigan. A week ago the statewide average was $3.13 in Illinois, but it was down to $2.89 on Thursday; prices still remained above $3 in the Chicago area, where local taxes are higher.
Pump prices fell elsewhere amid ample supply of gas and low oil prices. The average price for regular gas was $2.07 in South Carolina, the lowest of any state. GasBuddy.com listed several stations in the Columbia and Myrtle Beach areas of South Carolina that were selling regular gas for as little as $1.87 a gallon. Stations in Chattanooga, Tenn., and Birmingham, Ala., offered regular for $1.89. (Prices fluctuate throughout the day and could change.)
In California, the statewide average for regular gas fell 14 cents the past week to $3.40 a gallon. Gas had spiked in California in May and June because of refinery outages there, but prices have fallen 46 cents in the past five weeks, as supply issues were resolved. With prices rapidly retreating in California, Alaska has become the state with the most-expensive gas, at an average of $3.42 a gallon for regular.
The national average for diesel fuel fell 5 cents the past week to $2.59. Diesel prices have been unaffected by refinery issues this summer and have stayed on a steady slide. Diesel is $1.21 cheaper than it was a year ago, while regular gas is 90 cents cheaper.
AAA, GasBuddy and others have predicted that regular gas could fall below $2 in many parts of the country later this year if oil prices remain low and there are no major supply issues. U.S. oil was trading at about $40 a barrel Thursday morning, the lowest since 2009. Gas prices typically decline in the fall because there is less demand after Labor Day and refineries switch to winter blends that are less expensive to produce than summer blends.
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