Looking for some good news? Due to coronavirus, along with the nasty crude oil spat between OPEC and Russia, gasoline prices have plummeted throughout Escondido, San Diego County and America.
Unfortunately, this so-called good news is fairly off-putting, since pretty much all the places to go are closed.
Escondido gas prices Monday dropped to their lowest levels since January 2016 when prices dipped to the mid-two dollars in some places. On Monday, Gas Buddy listed 10 Escondido gas stations with prices below $2.80 per gallon of regular fuel. The lowest price was $2.52 per gallon of regular at Son’s Auto Service, 445 W. 5th Ave., just east of Centre City Parkway. Second lowest was C Stop just across the street at 434 W. 5th Ave. where it was $2.54 per gallon.
San Diego County’s lowest prices were at Rincon Travel Plaza at 777 Harrah’s Rincon Way, Valley Center at $2.45 per gallon of regular; Oceana Gasoline & Auto Care at $2.47 per gallon of regular, 502 S El Camino Real, Oceanside; Mohsen, $2.45 per gallon, 628 S Coast Hwy. and 3213 Mission Ave., Oceanside; La Jolla Trading Post, $2.48 per gallon, 22000 State Road 76, Pauma Valley; and Express Fuel, $2.49 per gallon, 3865 Mission Ave., Oceanside.
Not bad, but the lowest price in the nation today? A gas station in London, Kentucky in the Daniel Boone National Forest, about 150 miles southeast of Louisville, was charging 99 cents per gallon of regular. Analysts expected the national average eventually to settle at $1.49 per gallon.
The last time national gas prices were at that level was from 1990 to 1998, according to Statista. The last time the national average gas price limboed under $1 per gallon was 1980. Gas averaged 86 cents per gallon of regular unleaded then, which adjusts to $2.06 in 2020 dollars.
In fact, should prices fall to the $1.49 range, prices would represent the cheapest cost of gas since the first national figures were kept in 1932, and when adjusted to 2020 dollars, according to The U.S. Department of Energy’s Vehicle Technologies Office.
The last time motorists in California saw average prices for regular gas below $2 a gallon was a six-week period from December 2008 to January 2009, according to figures from the U.S. Energy Information Administration.
“Oil prices are at their lowest level since August 2016,” said Marie Montgomery, a public relations specialist with the Automobile Club of Southern California. “If that trend continues, we would expect to see more significant price declines in the coming weeks.”
Another reason “bigger price declines could be coming” is “expected lower overall gasoline demand due to the COVID-19 coronavirus outbreak,” Montgomery said.
The average price of a gallon of self-serve gasoline in San Diego County dropped 1.8 cents Sunday to $3.247, its lowest amount since Feb. 2, 2019.
The average price has dropped 17 consecutive days, decreasing 28.6 cents, including 2.5 cents on Saturday, according to figures from the AAA and Oil Price Information Service.
It is 16.1 cents less than one week ago, 31.1 cents lower than one month ago and 17.9 cents less than one year ago.
“I think there’s a strong possibility that your average in San Diego ultimately falls under $2 a gallon,” said Patrick DeHaan, the head of petroleum analysis at GasBuddy, a tech company that helps drivers find the cheapest places to fill up.
“As long as demand and oil prices stay low, we should see gas prices continue to drop,” said Jeffrey Spring, the Automobile Club of Southern California’s corporate communications manager.
Commercial and general motorist traffic has dropped significantly because of the coronavirus outbreak while oil prices have decreased both because of reduced demand and increased production by Russia and Saudi Arabia boosting the supply, Spring said.
The average price of a gallon of self-serve regular gasoline in Los Angeles County dropped Saturday to its lowest amount since Feb. 5, 2019, decreasing 2 cents to $3.305.
The average price has dropped 20 consecutive days and 23 of the past 24 days, decreasing 26.2 cents, including 3.2 cents on Friday, according to figures from the AAA and Oil Price Information Service.
The average price is 13.2 cents less than week ago, 26.8 cents lower than one month ago and 13.3 cents below what is was one year ago. It has dropped 31 cents since the start of the year.
The Orange County average price dropped to its lowest amount since Jan. 31, 2019, decreasing 2.5 cents to $3.247. It has dropped 25 consecutive days, decreasing 27.2 cents, including 2.5 cents on Friday.
Nationally, the average price has dipped below $2 a gallon in 12 states and some analysts have predicted prices in some areas could drop below a buck a gallon at this rate. One gas station in Kentucky made national headlines earlier this week by offering unleaded gas at 99 cents a gallon. It temporarily ran out of gas by Thursday morning.
2020 IS DIFFERENT
A month ago, Gas Buddy’s petroleum analyst noticed the first signs of gas prices dropping and now people across the country have noticed prices remarkably low.
WHY ARE GAS PRICES DROPPING?
The simplest way to explain it is that oil prices are dropping. Gas prices (what we pump into our cars) are closely correlated with oil prices (what we get from the ground), so once oil prices drop, gas prices tend to follow.
So why are oil prices dropping? Supply and demand. The demand for oil has dropped tremendously week-over-week, while supply remains high. There is a big imbalance between supply (high) and demand (low).
How does the coronavirus play a role? The coronavirus has caused countries to be in lockdown, limiting driving, flying and overall movement in order to contain the spread. This means very little need (demand) for oil.
The lockdowns started first with China, the second largest consumer of oil behind the United States, and now lockdowns are being imposed in multiple developed countries.
Saudi Arabia and Russia, aren’t they involved with the drop in oil prices?
Yes, they are. Because of such a drop in demand caused by the coronavirus, big oil-producing countries Saudi and Russia got together to discuss plans to cut-back oil production in hopes to balance out supply and demand.
The meeting didn’t go well. There was no agreement on what to do. Rather, it caused a price war that led to one of the biggest single-day-drop in oil prices since 1991.