Pump prices are dropping in Alabama and across the nation, and experts say they could keep dropping in the months and weeks ahead as surging COVID-19 cases take a toll on travel demand.
The average price for a gallon of regular unleaded gas in Montgomery has fallen about 13 cents in the past month to $3.03 on Monday, according to price tracking and analysis site GasBuddy. The average price for a gallon of regular unleaded gas in Tuscaloosa has fallen about 16 cents in the past month to $2.98 on Tuesday, according to AAA. The national average was down 11.1 cents in the past month, and Alabama’s average had dipped under $3 a gallon.
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AAA spokesman Andrew Gross said a recovering economy and strong employment have buoyed demand, but fears about the impact of the omicron variant have caused crude oil prices to wobble and may threaten consumption.
“For yet another week, average gasoline prices continue to fall as omicron cases surge, leading oil demand, and thus oil prices, to stall. The decline in gas prices will likely continue until new COVID cases slow down,” said Patrick DeHaan, head of petroleum analysis for GasBuddy.
“With gas prices very likely to continue declining this week in most states, we may see Christmas gas prices fall just under their all-time high on the holiday, which was $3.26 in 2013. Beyond Christmas, with omicron cases likely to continue climbing, I do believe we’ll see a more noticeable hit on gasoline demand once the holidays are over.”
New infections were up 41% in the past month to over 130,000 a day, according to Johns Hopkins data. Travel groups were dealing with cancellations, businesses and governments were moving to stricter safety rules, and the NBA, NFL and NHL were all changing their schedules.
The U.S. dumped millions of gallons into the supply chain from the strategic petroleum reserve earlier this year, but DeHaan said that move has had “very, very little” impact amid a rise in virus cases. “Omicron has just made the SPR release moot as well as the SPR release details actually being a disappointment,” he said.
For now, gas is still expensive compared to previous years. The Montgomery average on December 20 was $1.06 higher than the same day last year, and the national average was up $1.09 in the past year.
The last time gas was this expensive in the days before Christmas was 2013.
Contact Montgomery Advertiser reporter Brad Harper at bharper1@gannett.com.