Gas prices are likely to rebound as more communities ease stay-at-home restrictions that have been in place for weeks. The COVID-19 outbreak has led to less demand at the pump, an analyst said, causing prices to plunge.
The price is about $1.10 less per gallon than this time a year ago in St. Louis.
"As a result of the coronavirus we've seen demand drop by, in some cases, over 50% in just a few weeks,” said Patrick DeHaan, the head of petroleum analysis at GasBuddy.com.
There have been sudden price drops before in the U.S., including a roughly 10% drop in demand during the recession around 12 years ago.
But DeHaan said he can’t recall a plunge that has been so deep and so swift.
“There's really no comparison that I can make that we've ever seen anything similar to this,” he said.
But things are starting to change.
Prices in St. Louis and the rest of Missouri are inching up. They’ve increased by about a penny a gallon in the past few days.
And DeHaan said it’s more drastic in other areas of the country.
“Wisconsin, for example, has seen prices go up 30 cents a gallon in the past week.”
It had the lowest prices of any state in the country when the pandemic took hold. There have been recent hikes in other Great Lakes states as well.
And oil prices on international markets have rebounded after trading in negative territory last month for the first time ever. CNBC reports prices increased for five consecutive trading sessions before falling back Wednesday. They are now around $23.70 a barrel.
Those prices, along with a rise in demand as more states reopen their economies, will likely continue to drive increases at the pump.
But DeHaan is not anticipating a huge jump over the next few weeks.
“I really don't expect much more than say a 25- to 45-cent-a-gallon increase by July 4,” he said.
He added the coming recovery for gas prices is not going to be much of a shock to most drivers who have resumed filling their tanks to drive to work after spending weeks at home under social distancing restrictions.
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