TYLER, Texas — Are today’s gas prices worth celebrating? It depends on your point of view, but Texas drivers have more reason to feel pleased than those in any other state.
According to GasBuddy, the price of regular gasoline has fallen more in Texas in the last month than anywhere else in the United States.
AAA reported Wednesday that the average price of gasoline in Texas was $3.98. The average price had not been below $4 per gallon since May.
“You know after seeing the national average go up to $5, I might be embarrassed to say I am somewhat happy that prices are going down,” said Patrick De Haan, head of petroleum analysis for GasBuddy. “Having said that, they are still far higher than a year ago but at least it's not higher than where it was in June, so, we'll take the win. It's not a full win yet, but prices should continue moderating.”
According to AAA, drivers in Longview paid an average of $3.995 per gallon on Wednesday, adding it to the list of cities below $4. The average in Tyler is even lower, just $3.88 per gallon.
The daily average in Tyler has dropped 21 cents in the last seven days, and the statewide average is 70 cents less than it was a month ago.
“Apparently Texas is the place to be when it comes to competition and stations,” De Haan said. “Many stations generally pass along decreases slower because that's when they absorb that profit margin that they weren't able to absorb when prices went up. In fact, when prices go up, stations see their profit margins shrink.”
De Haan said prices typically rise quickly and fall slowly, but the circumstances causing prices to change are unique, dating to the lockdowns during the beginning of the coronavirus pandemic that forced millions of people to stay home. He said concerns about the economy have caused prices to fall since peaking June 15.
“The Federal Reserve raising interest rates to slow down the economy could trigger a recession or a slowdown. That could slow down oil consumption--oil prices dropping on the prospect of a recession. In addition, gasoline supply, up four out of the last five weeks in the midst of summer, that's a pretty impressive feat. So, on the supply side, things have improved. Refineries utilizing over 90% of their capacity as prices have gone up. They've had every incentive to boost production and that's what they've done. Those two factors are helping to lead prices lower.”
De Haan said he projects gas prices to continue falling for the next few weeks, but said economic conditions could change quickly, leading prices to rise once again.
“I think the market is expecting an economic slowdown or recession,” he explained, “and if we don't see a recession—which arguably would be good—we could see gas prices going back up, because it would also mean that the economy is in a better condition than we thought, which would likely boost oil demand and consumption versus a recession. So, there's also things like hurricane season, geopolitical tensions could flare up, or there could be other there could be unexpected refinery shutdowns not related to a hurricane. So, there's still plenty of issues. The house is being held together by string right now. That is, the decline in prices very delicate, and we could see prices go up. So, we're not completely out of the woods. Enjoy it while it lasts, because the next few weeks gets a little murky on what direction we're going to be going.”
To find the stations with the cheapest gasoline in Tyler, click here.