Gas prices have continued to fall nationwide during the coronavirus pandemic. One station in London, Kentucky became the first to drop to .99 cents on Thursday during the crisis, and sold out of gas shortly after the price drop. Prices have dropped below $2 in 12 states, and the national average is down to its lowest point since December 2016.
On Thursday, Spur, a BP station, dropped its price to .99 cents per gallon, causing a major back-up. As of Friday, the station is still selling gas at .99 cents per gallon, according to Gas Buddy. The next-cheapest station in the state is a Circle K in Henderson, which was selling gas for $1.21 per gallon.
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“We’re major backed up here,” employee Shirley Lunsford told Kentucky.com. “It’s crazy. I’ve never seen it this busy, and I’ve worked here for going on 16 years.”
“Our community is struggling and we’re a poor community anyway, and now that no one is able to go to work, we have a lot of waitresses local and stuff that aren’t even allowed to work now, so our boss was just trying to give everyone the opportunity to at least to be able to afford some gas,” another employee, Jennifer Johnson, told WATE. “We did run out this morning about 8:00 for about an hour, but if we do run our, it’s usually no more than an hour.”
“Everyone’s like, ‘Is it a gas war?’” Johnson added. “No, it’s not a gas war at all. It is strictly just trying to help, wanting to help. That’s all it is.”
The station’s price was far below the national average, which sits at $2.19 per gallon, reports CNN. That is down 13 cents from the previous week, an eye-popping 36 cents lower from this time last year and the lowest since early December 2016. Oklahoma has the cheapest state average, with $1.84. Gas is still not cheap in Hawaii and California though, where the average is $3.52 and $3.28 for a gallon of regular gas.
Tom Kloza, head of energy analysis for the Oil Price Information Service, called the sudden drop “unprecedented” and predicted the national average could drop to $1.99 per gallon. Within the next few months, it could drop even further, to $1.25 to $1.50.
The last time the national average dropped under $1 per gallon was back in 1999.
The simple reason for the gas price drop is too much supply of oil and not enough demand, notes Gas Buddy. The coronavirus outbreak is playing a role, as more people are staying home under self-quarantine. Russia and Saudi Arabia also recently met to discuss cutting back on oil production, but there was no result from the meeting. If the two meet again and decide to reduce production, we could see gas prices back to what we are used to seeing.
In the U.S., oil prices dropped a 24 percent on Wednesday to $20.37 a barrel, the lowest since February 2002.
“There is a pre-coronavirus level for oil demand, and a post-coronavirus level of demand,” Gas Buddy notes. “Demand for oil will be at multi-decade lows for a better part of 2020, which means gas prices will be some of the lowest we’ve experienced in a while.”
There are now more than 16,600 confirmed coronavirus cases and 210 deaths in the U.S., as of Friday, reports Johns Hopkins University.
Photo credit: CHRIS DELMAS/AFP via Getty Images
