Lower gas for Americans this Christmas

This holiday season, many US drivers are getting the gift of lower gas prices.

According to data from motor club AAA, December has been the cheapest month for prices at the pump this year. The national average for unleaded gas has stayed below the US$3 mark since December 2, falling to its lowest level of about US$2.85 a gallon on Monday. That figure has inched up slightly since, sitting closer to US$2.86 a gallon on Tuesday – but overall, consumers hitting the road ahead of the Christmas holiday will likely continue to see mild prices.

As always, some states have cheaper averages than others, due to factors ranging from nearby refinery supply to local fuel requirements. Hawaii had the highest average of about US$4.44 a gallon on Tuesday, per AAA – followed by US$4.30 in California and US$3.92 in Washington. Meanwhile, Oklahoma had the lowest average at about US$2.30 per gallon, followed by nearly US$2.42 in both Arkansas and Iowa.

Still, nationwide, unleaded gas is down more than 18 cents, compared with this time last year, and 21 cents from a month ago. So far, AAA says that prices seen this month mark the cheapest December for gas prices since 2020, when the COVID-19 pandemic roiled the economy.

The travel organisation notes that this month’s cheaper prices arrive as supply remains strong. Crude oil, the main ingredient in gas, has also been at a relatively mild level – with West Texas Intermediate remaining below the US$60 per barrel mark for most of December. Relief at the pump is welcome for consumers, who have been feeling higher prices in other parts of their budgets – as worries about the costs of goods, ranging from groceries to holiday gifts, rise amid ongoing inflation and US President Donald Trump’s tariffs on foreign imports.

Government data actually showed that consumer prices cooled in November, rising at just 2.7 per cent from a year earlier. But year-over-year inflation still remains well above the Federal Reserve’s 2 per cent target – and economists quickly warned that last month’s numbers were suspect because of delays and possible distortions from the 43-day federal shutdown.

Most Americans have continued to express anger and frustration about the high cost of living – as well as an uncertain job market. On Tuesday, the Conference Board said that its consumer confidence index fell in December to its lowest level since April.

AP