Why are oil and gas prices dropping and will the trend continue?

For the first time in almost 4 years the price of a gallon of gas has fallen below $3.00 on average across the nation, according to AAA. While consumers certainly aren’t complaining about the lower prices at the pump, many are still concerned that it will only be short-lived.

Bob Darbelnet, the CEO of AAA, said in a recent press statement that “The steep decline in gas prices has helped to make driving less expensive for the vast majority of Americans use their car every day,” adding that “many Americans are spending $10-$20 less to fill up the cars on every trip to the gas station compared to what they paid during the summer driving season.”

So when gas prices fall, people pay less money for gas at the pumps. Thank you for that keen insight, Captain Obvious.

Some of the factors that are helping to drive the price of gasoline lower were looked at recently by the US Energy Information Administration (EIA) and, according to them, one of the reasons is that the domestic production of oil in the United States has grown from 5.6 million barrels per day to 7.4 million barrels per day.

The EIA is also projecting what they say is going to be “rapid production growth” through the end of 2014 and into 2015, but admitted that the pace and duration of America’s oil production boom is uncertain.

Amy Jaffe, the executive director for energy and sustainability at the University of California, Davis says that “I don’t think consumers are out of the woods,” in terms of what’s going to happen with gasoline prices.  Jaffe added that “I think we could  see very high gasoline prices again in the next couple of years if something went wrong in the Middle East, for example.”

It seems that, even though Halloween has passed, Ms. Jaffe and Mr. Darbelnet are both still trying to win the prize for best Captain Obvious costume.

Luckily both are optimistic that the prices will continue to fall due to the combination of historic production levels right now in the United States along with a number of new, renewable energy technologies. These new technologies will, if things go well, deliver cheaper and more sustainable supplies of power more dependably.

In fact, once a breakthrough in technology is finally found regarding batteries, as far as their cost and efficiency, Jaffe believes that alternative power like wind and solar will come into its own and give the oil industry a run for its money. She even went so far as to say that, at some point in the future, many communities will voluntarily remove themselves from the local electrical grid and rely on their own alternative power instead.

That being said, the fact is that oil, and the gas prices that depend on it, is geopolitical. It’s impossible to say that consumers don’t have any more worries about the cost of gasoline going back up.

The good news is that, according to Jaffe and other experts, the price of a barrel of oil is going to drop to around $50 in the near future, and prices at the pump will subsequently fall even lower. So, for the time being at least, American consumers have something to be happy about at the gas pumps.

Impacts of Rising Fuel Prices

Americans have driven cars for more than 100 years. Throughout this time, cars have become a major part of the American lifestyle.  Most U.S. families own at least one car.  This may be due to the limited mass- transit options in many parts of the country.  And in some places, weather conditions make walking or bicycling year-round difficult. There are 136 million passenger cars in the United States.  About 97 percent of them rely on the internal combustion engine (ICE).  ICE cars and trucks use 50 to 70 percent of oil produced in the country.  They use so much because their engines are inefficient. But, the engine isn’t the only problem.  Some people prefer fast sports cars, heavy, powerful trucks, or sport-utility vehicles (SUVs).  Moving fast or pulling heavy weight uses additional fuel. So, these powerful vehicles are even more inefficient. Automakers say they would build more efficient vehicles if they knew that more people would buy them.

When fuel is inexpensive, fuel efficiency is not a major concern for most drivers.  However, fuel prices have increased in recent years.  This is partly because the United States largely depends on imported oil.  Yet, much of the world’s oil is located in politically unstable countries.  So, the United States may not always be able to obtain the amount of oil it currently consumes.

In addition, ICE vehicles cause environmental problems.  Their exhaust contains unburned or partially burned fuels. These emissions are poisonous and contribute to smog.  ICE vehicles also emit other harmful gases. For these reasons, consumers and car companies have shown interest in alternative cars.  Some alternatives, such as electric cars, have been around for many years.  Others, such as hydrogen fuel-cell cars, are still being developed.  Despite their differences, alternative cars share a common goal.  They provide more efficient transportation with less harmful effects.

When gasoline prices rise, many people pay closer attention to the fuel economy of their vehicles.  Fuel economy is measured by how many miles a vehicle can travel using one gallon (4 L) of fuel. The U.S. government publishes a list of fuel economy ratings for cars.  However, many drivers report that they get fewer miles per gallon than the listed amount.  This is because the rating system does not reflect how most people drive.

Fuel economy ratings assume people drive no more than 60 miles per hour (97 km/h). And, they assume people accelerate slowly, going from 0 to 60 miles per hour in 18 seconds.  However, the average driver accelerates about five times as quickly. Weather also affects fuel economy.  Federal standards measure fuel economy at 68 to 86 degrees Fahrenheit (20 to 30°C), without air conditioning.  In most places, temperatures are well outside that range.

Finally, more energy is needed to move heavy weight.  Today, the average U.S. adult weighs about 25 pounds (11 kg) more than the average adult in 1960.  Compared to the yearly amount of gasoline that U.S. passenger vehicles burned in 1960, they burn an additional 938 million gallons (4 billion L) today.  That extra gasoline would be enough to fuel nearly 2 million cars for a year!

The Benefits of These Lower Gas Prices!

A major drop in gasoline prices in the last 3 to 4 months has allowed many consumers around the country to start putting more money in savings and also pay down their debt, according to a new survey from Wells Fargo/Gallup.

The survey, which talked to just over 1000 consumers and investors, showed that on average they’re saving $108  every month. That’s between consumer’s still in the workforce who are saving approximately $117 a month and retirees saving about $68 a month. For the survey, an investor was defined as an adult with more than $10,000 in both savings and investments.

What the survey showed was that, due to gas prices that are lower than they’ve been in nearly 6 years, approximately 7 out of every 10 consumers in the US are using the money that they’re saving at the pumps to improve their financial situation by either investing the money, putting it in savings or paying down their debt.

That breaks down to approximately 37% who are using the savings to pay off debt, 33% who are putting it into some side of savings plan and approximately 25% that are simply using the extra money to make additional purchases. Nearly 30% responded that the extra money they are saving on gas is helping them “a lot” with their household budget.

Analysts see this as great news because it means that, rather than wasting the extra money that they’re saving on frivolous or nonessential items, the majority of American consumers are doing something positive with that money instead. Gas prices have risen slightly over the last few weeks but, on average, are still about 35% less than they were at the same time last year and lower than they have been in the last five years.

Believe it or not, Gas Stations are getting into “Gas Wars” again

If, like many of us here, you were around during the 1970s, you might remember that gas stations used to use all sorts of gimmicks and promotions to get customers to come in. From giving away glasses and toys to offering the “cheapest gas in town”, it was an interesting time indeed at the gas pumps.

When gas prices went over $4.00 a gallon last year, and stayed there for the majority of the first half of this year, nobody would have ever thought that a similar trend would ever recur, but that’s exactly what’s happening.

For example, in Oklahoma City, Oklahoma, an OnCue gas station recently was the first to drop its price per gallon below $2.00, to  $1.99. The same day, a competitor a block away dropped their price to $1.98 per gallon.

The reason they did it was simple; cars at the OnCue station were lined up down the block in order to purchase gas at such an unheard-of (these days) low price, forcing them into a “gas war” in order to get customers.

The fact is, gas stations all over the country are scrambling to keep customers coming in as gas prices continue to drop, something that has many consumers giddy with elation. Most have no idea of the perks that used to be available during the 1970s and, after years of paying through the nose at the pumps, our only worried about getting gasoline as cheap as humanly possible.

For the time being that’s not a problem at all, as the average price per gallon nationwide, according to AAA’s Fuel Gauge Report, was $2.74, an incredible drop in $.50 per gallon from just a year ago. In Oklahoma, where the gas war erupted, the average price per gallon was an incredible $2.53, mostly due to the fact that Oklahoma is one of America’s biggest oil-producing states.

Amazingly, as much as the two gas stations mentioned above wanted to make an impact on customers and increase their sales, another gas station in the Oklahoma suburb of Moore dropped their price to $1.95 a gallon the very same day.

With gas prices continuing to fall rapidly, it looks like the trend is definitely going to continue. For motorists everywhere, it’s some of the best news possible, especially with the holiday travel season upon us.

We don’t know about you but many of us here at our blog, given that gas stations are doing their best to lure customers, would love to see then start giving away Matchbox cars again with every fuel purchase.

Is Gas Really More Expensive on the Weekend?

We’ve certainly had our fill of blogs about gasoline prices, gas saving devices and methods of increasing your MPG. Today’s quick little blog article is about gas prices and, more specifically, the question of whether gas is more expensive on the weekend or not.

Many people around the country complain that gas stations seem to increase their prices on the weekends but the fact is that, more often than not, gas prices are actually higher during the week.

The statistics gleaned by GasBuddy.com, a crowd-sourced gas price aggregator, actually showed that, during a four-year period, Friday, Saturday and Sunday were the days when gas prices were the lowest. GasBuddy performed an exhaustive amount of research in all 50 states find out what days of the week gas was cheapest and, although prices fluctuated during that time period, their results still were a bit of a surprise for many people.

“I think that was the biggest surprise,” said Patrick DeHaan, a senior petroleum analyst.  He added that “What I can surmise is that the markets aren’t open, so because oil and gas futures and spot prices aren’t trading on the weekend, stations are more likely to become competitive.”

The fact is, gas station owners realize that people have more time to comparison shop on the weekends, something that encourages them to be more competitive when it comes to their prices. Most consumers also do a bit more driving on the weekends than they do during their typical Monday to Friday routine and station owners are keen on taking advantage of the additional revenue that comes their way.

A few of the more interesting results from the analysis performed by GasBuddy showed that, in some Western states including Utah, Wyoming, North Dakota and South Dakota, gas tended to be cheaper towards the middle of the week. Kansas is similar but, in Indiana, Iowa and Kentucky, Monday is usually the best day to fill up because gas prices are cheapest there on that day.

If you live in Delaware and Maryland, your best bet is on Thursday as GasBuddy showed that to be the least expensive day at most gas stations there.

Truth be told, finding the cheapest gas no matter where you live can be a little bit difficult because they change quite frequently. That’s why it’s a good idea to use the GasBuddy app in order to see where the cheapest price is every day in your city or town.

Just for the record, this blog was not sponsored in any way by GasBuddy.  It’s just that, when it comes to finding the cheapest gas prices available, we think it’s the best app the market.

Tips for Lowering your Gasoline Costs

While gasoline costs across the country have stabilized and, incredibly, even gone down a bit in the last few months, gas is still over $3 dollars a in most states and close to $4 a gallon in some. Now, to be perfectly honest, we’ve written quite a few blogs about how to lower your gasoline costs and increase you are mileage with every tank of gas. That being said, below we’ve put together a few of the best tips that we have so that if this is your first time searching for these types of tips you get some of the best. Enjoy.

Tip 1: Lighten the load. Even as little as five extra pounds of weight in your vehicle can lower your mileage and, unless it’s something that you need for your work, your best bet is to completely clear everything out of your car that isn’t 100% necessary. From extra clothing and maps to bowling balls, fishing gear and even bricks (yes, bricks), that extra weight is causing extra damage to your wallet or purse at the pump.

Tip 2: Catch a ride with a friend or neighbor. You might not know someone who lives close by and works close to where you work as well but websites like RideSearch.com and eRideShare.com can help you to find someone. If they don’t simply Google the word “carpool” and the name of the city or town that you live in and you’re bound to find all sorts of information that can help you. Carpooling will not only save you gas but also maintenance on your car as well as allowing you a little bit of extra time (if you’re not the driver, of course) to get yourself prepared for the day on the ride to work.

Tip 3: Use an app to compare gas prices. There are a number of them but the two best are GasBuddy.com and gaspricewatch.com, both of which are excellent smartphone apps that can show you which station in your town has the best price. If it’s on your way and convenient, you can sometimes save up to $.20 a gallon depending on where you live.

Tip 4: Make use of your car’s aerodynamics. Listen, unless you’re a professional skier or you use your bicycle (street or mountain) more than once a week, there’s no reason to have ski or bicycle racks on your roof all the time. (Yes, they might look slightly “cool” but if you waste gas aren’t you then also a “fool”?) Save money by taking them off.

Tip 5: Get a gas rewards card. If you do a lot of driving you might consider getting a gas rewards card but only with one caveat; you must pay your credit card bill in full every month. If you do then the rewards can be well worth it but if you don’t the extra charges in interest can negate any rewards that you might get.

Tip 6: Consider a four-cylinder engine in your next new or used car. Want to know what uses a lot of gas? A big engine. Yes, it might get you going faster on the highway but seriously, the difference is so negligible in most cases as to make it not worth it unless you’re going to be towing something on a regular basis.

Tip 7: Make sure to maintain your car regularly. Checking the air pressure in your tires is something that you can easily do yourself but things like making sure your oil is good, your transmission fluid is up to snuff and your car is running well in general are things that you’ll have to go to your local mechanic to have done. If you want to save money at the pump as well as on major repairs, there’s no better way to do it then keeping up with your car’s maintenance.

Tip 8: Learn how to coast. While we aren’t fans of turning your engine off and coasting to a stop, something that might be dangerous depending on the type of car that you have, keeping an eye on traffic and taking your foot off the gas so that you coast to a stop while in drive is a great way to conserve gas. The fact is that once your car is moving you’ve already used gasoline to get it up to speed. If you see a stop sign or traffic light coming and you know you’re going to be stopping, what’s the sense of using even more gas to get there? Take your foot off the pedal and simply coast, using your car’s momentum to get you there instead.

And those, dear readers, are some of the best Tips that we’ve come across in the last few years for saving money on gasoline and increasing your MPG. We hope that some of them might be helpful to you and we also encourage your questions and comments.

Which States have the Lowest Prices on Gasoline?

If you’ve been to a gas station recently you might have noticed that the price has gone up a little it.  I’m being facetious of course as, in fact, gas prices have increased a whopping .49 cents since the beginning of the year, the biggest jump ever in the first 2 months of any year. In fact many experts are predicting that gas will be at a $4.00 per gallon average by this coming summer, a grim reality for many who use their cars on a regular and constant basis.  There are already 4 states where gas is over $4.00 per gallon and about another half dozen that are close.

There are, however, a few where for whatever reason the prices have remained closer to $3.00 than to 4.  With that in mind we thought we’d put together a list of the top 10 cheapest states for gas.  Will this help you save gas?  Well, no, but it may help you to make future plans or make you happy that, even as prices rise, your state is still cheaper than some others.  So take a look and cross your fingers that yours is on the list.  Enjoy!

10) Tennessee. If Tenneseein is believin’ you’re going to like what you see at the pump as prices there, tied for 9th with Oklahoma, are at $3.62 per gallon

9) Oklahoma. One of the largest oil producers in the nation helps Oklahoma to share 9th place with Tennessee at the same price per gallon, $3.62

8) Missouri. Even though they don’t have any refineries of their own Missouri comes in at 8th because they are neighbors with Oklahoma and Illinois.

7) South Carolina. Having the 4th lowest gas taxes in the county has helped South Carolina to come in at 7th even though they don’t have any refineries producing it.

6) Colorado.  Being near to Canada and their cheap crude oil helps Colorado to come in at 6th place and also, at least up until a month ago at least, keep their gas prices under $3.00 a gallon.

5) New Mexico.  One of only 5 states where gas was less than $3.50 per gallon New Mexico is also a state where the median income is much lower and the recent increase have caused very real problems for the people living there.

4) Idaho.  Being Montana’s neighbor has helped Idaho to not only come in 4th but also to have one of the lowest price increases in the country at $3.45 per gallon.

3) Utah.  Even though less than 6 months ago they were one of the highest Utah is now one of the lowest states at $3.43 per gallon, thanks in part to their 5 refineries.

2) Montana. They have higher taxes than most but the fact that Montana has their own oil resources and are close to Canada and theirs the gas prices there are the 2nd lowest at $3.28.

1) Wyoming.  The top spot goes to Wyoming where, at $3.27 a gallon, the lowest price on regular gas can be found.  One of the main reasons is that they have the 2nd  lowest gas taxes, only losing to Alaska.


Simple Gasoline Saving Tips

These days it doesn’t matter if you drive a teeny hybrid or a monster SUV everybody is trying to save money on gasoline because the price per gallon is so darned high. Even an improvement of 1 or 2 miles per gallon can mean big savings at the pump and keep your wallet from having a conniption fit. The tips below will all save you a small amount but, used in combination, should help you to lower your gas costs by about 10 to 15%.


Slowing down on the highway is an excellent way to save gas and increase your mileage. In fact, every 5 miles an hour that you drive over 60 uses about 20% more gas, which over a long trip can really add up.  If you don’t mind the trip taking just a little longer set your cruise control for the speed limit and be content to save some money.


Make sure that your tires are always inflated at the proper psi and check them once a week. Tires will lose air normally even if they are perfect so checking to make sure that they are is important. Underinflated tires can use 10% more gas at least so making sure they’re properly inflated will definitely save you gas.


The air filter is also something that needs to be checked and replaced often because it can hamper your car’s ability to perform and cost you big buck over time. Check to see if there’s one of the newer ‘permanent’ replacement filters that only need to be cleaned and save even more.


Be aware of where you are on the road an anticipate stops.  The more you have to stop the more gas you use when accelerating. If you take it easy and make all the lights rather than speeding and stopping ate every single one you’ll save gas and save the brakes too.


Make sure you change the oil at the required time.  Older oil can severely affect the performance of your car and waste a lot of gas.  Change it regularly and use the best oil for your make and model.


If you’re stuck in traffic chill out and hang with the trucks.  You’ve probably noticed that they roll along and don’t brake as much, yes?  That’s because they don’t want to shift those 10 gears but, if you do the same, you’ll save fuel and your brakes over stopping and starting constantly.


So now that you have them get out there and use these tips to save gas and money at the pump. Enjoy!



How to Increase your Fuel Economy – Part 3 of 3

Welcome back for Part 3 of 3, How to Increase your Fuel Economy.  As with Parts 1 and 2 you’ll find many great Tips here on how to make your car more fuel efficient, save money on gas, and make those fill-ups less painful for your wallet.  This is the final Part and,. Once you’re done here, you’ll have plenty of ammunition to shoot down the high cost of gas and keep your hard-earned money where it belongs, in your wallet.

Don’t buy high octane gas.  Unless you’re driving a Ferrari there’s almost no need to buy high octane and it won’t affect your car’s performance.  Most cars that say they need high octane simply don’t, and you can save a LOT of money buying regular.

Don’t overfill your tank. Once the pump shuts off you should put it back in the holster and be done. Overfilling can waste as much as 2% of your gas.

Close your gas tank cap properly and securely.  Gas, when left uncapped, will vaporize and be gone forever.  Did you know that almost 150 MILLION gallons of gas vaporizes every year in the US?!

If you can, use a gas credit card.  The best cards will have a rewards plan that saves you a few cents a gallon.

Don’t speed.  This one is a biggie.  For every 5 miles an hour you drive over 60 mph you spend approximately .20 cents more per gallon!  Experts say that this is the single most effective way to save money on gas.  Also, did you know that over a 10 hour trip the difference between driving 60 mph and driving 70 mph only adds up to about 30 minutes less driving time?

Use your cruise control. Driving at a steady speed on flat ground is a great way to save gas but, because humans are humans, without cruise it’s hard to do.  Us the cruise and save at the pump.

Try to anticipate lights. The less stopping you do the less gas you use accelerating again.

If you will be stopped for more than 30 seconds don’t idle.

Finally, the best way to save on gas and increase fuel economy is to drive less.  Use your bike, take a walk or even catch a bus or train.  The less you use your car the more gas (and money) you will save.  Good luck with all of these Tips and happy driving!





How to Increase your Fuel Economy – Part 2 of 3

Welcome back for Part 2 of How to Increase your Fuel Economy.Like Part 1 there are plenty of great Tips here that will reduce the sting of going to the pumps and squeeze every last mile out of every gallon of gas that you purchase. Most of these Tips are quite easy to implement too, so once you’ve read them you won’t have any excuses to not start using them and start saving money ASAP.

Consolidate your trips.  Rather than going out every time you need to buy one item or have to go to the bank or to the post office make a list of all the places you need to go and all the things you need to purchase and do them all in 1 trip.  This will save you gas and time.

If you carry a lot of junk in your car get rid of it!  There’s no need to carry around a trunk full of junk, especially if that junk is costing you mileage. Clean out the junk and save money on gas.

Get rid of anything that causes drag.  Did you know that about half of the energy your car uses is used to overcome drag?  It’s true!  Get rid of ski racks, luggage racks, and even racks of lamb. (Kidding.)

Avoid high speed starts.  Unless there’s a bus or train barreling down on you start slowly and surely and you’ll save 5% on gas consumption.

Unless you live close or are passing by, don’t go out of your way to save anything less than .10 cents a gallon on gas.  Under .10 cents the savings just don’t make up for the lost time and fuel. 

Buy your gas in the morning.  Gasoline expands with heat.  If you buy your gas in the afternoon after a hot day you will actually get about 5% less gas than you will in the morning when the gas is cooled off.

As crazy as it sound you should buy your gas on Wednesdays.  Statistically speaking this is the cheapest day of the week for gas prices.

Start using these tips as soon as you can and you’ll see an immediate difference in the amount of gas you use and the amount of money you spend.  Then come back for Part 3 and more great gas saving, fuel economy increasing Tips.



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