Gas prices seems to be heading below $2 a gallon in Delaware as crude oil prices plummet.
Wilmington-based AAA Mid-Atlantic, which uses average prices in its calculations, reported Claymont on the northern edge of Delaware, is now seeing $2 prices in spots.
GasBuddy, which uses crowdsourcing (reports from motorists) at its tracking service, reported $1.98-a-gallon gas on Kirkwood Highway, between Newark and Wilmington.
Gas Buddy still lists the average price in Delaware as $2.20. The lowest average price was reported in Missouri, which is now selling regular for an average price of less than $1.80 a gallon.
So far, Wawa and Royal Farms, perhaps the biggest largest gas station group in the state, has kept prices just above $2.
“The dramatic slide in retail gas prices has been driven by a similar plummet in global crude oil prices since the end of the summer of 2014,” says Jim Lardear, director of public and government affairs for AAA Mid-Atlantic. “This decline in the price of oil has been a product of weak demand combined with abundant supply, as the commodity has dropped below the $50 per barrel mark in recent weeks.
“Barring any major increases in the global price of crude oil, AAA expects the national average price for regular unleaded gasoline to remain below $3.00 per gallon in 2015,” Lardear says.
The lower gas prices, the result of added production in the U.S. and a decision by Saudi Arabia to not cut production, have led to layoff plans in the energy industry, although those effects are expected to be offset by consumers having more spendable income.
The Saudis have the ability to withstand plummeting prices, since extraction costs are only a few dollars a barrel, compared to $50 or more in much of the U.S. The U.S. has been able to grow reserves through the use of a controversial technology known as hydraulic fracturing or “fracking.”
The Delaware City Refinery has profited from transporting crude oil from discoveries in North Dakota to Delaware via rail.
