EVERETT — Tumbling gas prices are expected to continue falling and could approach $2 a gallon near the end of the year.
The drop is driven by a mix of factors, including low crude oil prices, falling driver demand and refineries switching to winter-blend gasoline, which is cheaper to produce.
On Tuesday, the average gas price in Snohomish County was $2.83 a gallon. Costco stores had the lowest prices in the county — $2.29 a gallon, according to Gasbuddy.com, a gas-price tracking website.
“I think a few $1.99s could start popping up” this fall, said Allison Mac, a Los Angeles-based analyst with Gasbuddy.
The state average price for a gallon of regular gasoline was $2.76 Tuesday afternoon, according to the website.
That price likely will drop to between $2 and $2.20 by mid-December and in January, she said.
Gasbuddy’s analysts expect the national average to get as low as $1.90 a gallon. The national average Tuesday afternoon was $2.31, a 2.6-cent decline from the previous day’s average.
Gas prices are considerably lower than 12 months ago, when the average in Snohomish and King counties was nearly $1 higher, according to AAA’s Daily Fuel Gauge Report.
Those savings quickly pile up.
Tom Kloza, chief energy analyst and a co-founder of Oil Price Information Service estimates American drivers are paying $455 million less a day at the pump. The Gaithersburg, Maryland-based company owns Gasbuddy.
Gas prices in Washington haven’t caught up with falling crude oil prices, he said.
“If you’re not Costco, you aren’t rushing to drop your retail price, because you’re basically seeing the same demand as last week,” he said.
After all, retailers “make their money when wholesale prices are dropping faster than prices on the street,” he said.
Analysts expect gas prices to stay down into 2016. The U.S. Energy Information Agency actually forecasts the average price next year to be less than in 2015.
However, many factors influence gas prices. If China’s economy rebounds, Saudi Arabia cuts oil production or a major refinery accident happens, prices will jump.
In any event it’s likely that gasoline prices eventually will rise again, Kloza said. Consumers “are already going back to sloppy behaviors,” such as buying bigger and less-fuel-efficient vehicles.
Dan Catchpole: 425-339-3454; dcatchpole@heraldnet.com; Twitter: @dcatchpole.
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