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Gas prices to stay cheap after coronavirus slide
National gas price average could drop to $1.50 per gallon: Analyst
Patrick De Haan of GasBuddy argues the average gas price will continue to go lower.
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Not only are gasoline prices cheaper than they've been in years, thanks in part to the coronavirus shutdown of most economic activity, they're likely to remain that way for the foreseeable future.
Futures contracts for May delivery have plunged 24 percent this year to 51.03 cents per gallon as “stay-at-home” orders issued to slow the spread of COVID-19 kept drivers off the roads, crushing demand for fuel.
To estimate what those futures prices mean for motorists at the pump over the next few weeks, Wall Street typically adds about 60 cents (excluding high-tax states such as New York and California), meaning gas prices appear likely to slide even further below Wednesday's national average of $1.80 a gallon.
And that was already a sharp decline from $2.84 a year earlier, according to AAA.
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“The consumer can expect these low prices to persist over the next three months because the oil market continues to be overwhelmed with supply,” Andrew Lipow, president of the Houston-based consulting firm Lipow Oil Associates, told FOX Business.
“It's not until demand begins its long road to recovery that we're going to see gasoline prices beginning to go up,” he added. "Looking out forward, there is a moderate increase in gasoline futures prices, which is a reflection of the anticipation that the economy will begin to open up, resulting in an improvement in demand."