The holiday season brings a silver lining for drivers as gasoline prices dip to their lowest level of the year.
December Sets New Low for Pump Prices
Motor club AAA reports that December has become the cheapest month for unleaded gasoline this year. Since December 2, the national average has stayed below $3 per gallon, reaching a low of about $2.85 a gallon on Monday. A modest rise to roughly $2.86 a gallon on Tuesday suggests the trend will likely hold as consumers head into the Christmas holiday.
State-by-State Snapshot
Prices vary widely across the country. Hawaii tops the list with an average of about $4.44 a gallon on Tuesday, followed by California at $4.30 and Washington at $3.92. In contrast, Oklahoma records the lowest average at about $2.30 a gallon, with Arkansas and Iowa close behind at nearly $2.42 each.
Nationwide Decline Compared to Past
Across the nation, unleaded gasoline is down more than 18 cents from the same period last year and 21 cents from a month ago. AAA notes that this December marks the cheapest gas prices since 2020, the year the COVID-19 pandemic first disrupted the economy.
Crude Oil and Supply Conditions
The relief at the pump comes as crude oil, the main ingredient in gasoline, remains at relatively mild levels. West Texas Intermediate stayed below the $60 per barrel mark for most of December, supporting the lower retail prices.
Inflation, Tariffs, and Consumer Costs
While gas prices ease, consumers still face rising costs for other goods. Grocery prices and holiday gifts have climbed amid ongoing inflation and U.S. President Donald Trump’s tariffs on foreign imports. Government data shows that consumer prices cooled in November, rising only 2.7% from a year earlier. However, year-over-year inflation remains well above the Federal Reserve’s 2% target, and economists warned that the November figures may be distorted by delays and the 43-day federal shutdown.
Confidence and the Job Market
The broader economic picture remains uneasy. Most Americans continue to express frustration over the high cost of living and an uncertain job market. The Conference Board reported that its consumer confidence index fell in December to the lowest level since April.
Key Takeaways
- December’s average unleaded gasoline price is about $2.85 a gallon, the lowest since 2020.
- State averages range from $2.30 in Oklahoma to $4.44 in Hawaii.
- Gas prices are down 18 cents from the same time last year and 21 cents from a month ago.
- Crude oil prices stayed below $60 per barrel for most of December.
- Inflation remains above the Federal Reserve’s 2% target, with consumer confidence at a low.
The holiday season may bring some relief at the pump, but broader economic pressures continue to weigh on consumers.
