Gas prices have dropped an average of 40-percent since June, and continue dropping.
American’s have found themselves with a little money to spare, a pleasant fact which can be attributed to the dramatic drop in gas prices. July’s national average for a gallon, $3.59, is in high contrast with the one we’re seeing today. This national average has dropped a little more than a dollar and currently sits at $2.38 a gallon, a staggering difference to those on the road.
According to expert Cairo Carras, “At a meeting in Vienna on November 27th the Organisation of Petroleum Exporting Countries, which controls nearly 40% of the world market, failed to reach agreement on production curbs, sending the price tumbling.”
The price of gas is, for the most part, determined by supply and demand, and partially by expectation. E.L, from The Economist, explains, “Demand for energy is closely related to economic activity. It also spikes in the winter in the northern hemisphere, and during summers in countries which use air conditioning. Supply can be affected by weather (which prevents tankers loading) and by geopolitical upsets. If producers think the price is staying high, they invest, which after a lag, boosts supply. Similarly, low prices lead to an investment drought. OPEC’s decisions shape expectations: if it curbs supply sharply, it can send prices spiking.”
However, experts are predicting gas prices to plummet back up between 35 and 60-cents by the summer.
Still, motorists are loving the present.
“People who drive a lot are definitely [benefiting]. Also, home heating oil should be cheaper now for the winter months,” said Mr. Dave Tutacko, Economics teacher. “Trucking companies should benefit as well, which will make it less expensive to ship items around the country.”
Tutacko said he is saving, on average, $17.50 every time he fills up his fuel tank.
Students, too, are feeling the extra money in their pockets. A recent poll of Bishop Noll’s student body said that most of them would like to spend the extra money saved by going somewhere nice and warm for Spring Break.
Low gas prices are also positively affecting school districts all over the United States. Schools are finding themselves with extra money that they are saving on their energy bill, which is a huge opportunity for schools that are looking to get new materials but didn’t have all of the funding for it.
However, Delta Airlines, which projects an average of $1.7 billion in fuel savings in 2015, has made no adjustments to their ticket prices. “When it comes [to] lower [gas prices], hang on to all [you can],” Delta CEO Richard Anderson told investors in December, “that’s kind of our philosophy.”
Lower gas prices are a benefit to those on the road, those in the business of education, and even those up in the sky. Every single person can see themselves getting something good out of the low-slung price-tag on gasoline right now. So begin to think about all the different stuff that you can do with that extraneous change you find in your wallet.