Demand destruction due to the CCP Virus, or COVID-19 pandemic, is sending the U.S. gas price to the lowest level in years.
The average national gas price has declined steadily for seven weeks, pushing the average cheaper by 61 cents to $1.86 per gallon on Monday, April 13, according to AAA Gas Prices.
The price fell further early Tuesday, with a gallon of regular unleaded gas at $1.85.
At this level, the national average is down nearly a full dollar from the same time last year, when it was $2.82.
“We are seeing fast and furious gasoline demand destruction. The latest data reveals demand levels not seen since spring of 1968,” said Jeanette Casselano, an AAA spokeswoman. The U.S. region is seeing accumulations in gasoline inventories and crude storage, which is just driving pump prices even cheaper.”
Since late February, U.S. demand for gasoline has decreased 44% to 5 million barrels per day (bpd) as gasoline inventories build across the country.
Casselano added that while the Organization of the Petroleum Exporting Countries plus (OPEC+) has agreed on a nearly 10 million bpd production cut over the weekend, “it’s likely to not have an immediate impact on pump prices given the ongoing impact the COVID-19 pandemic continues to have on crude oil prices and gasoline demand.”
CNBC also cited industry analyst Trilby Lundberg saying that demand is declining amid widespread stay-at-home orders during the CCP Virus pandemic.
Data from AAA shows that Wisconsin now carries the cheapest average in the country with pump price declining to $1.30/gallon.