American Pump Prices Fall Below $2 in First Time in Four Years
American Pump Prices Fall Below $2 in First Time in Four Years
(Bloomberg) -- U.S. retail gasoline dropped below $2 a gallon for the first time since March 2016, before President Trump was elected.
The average pump price fell to $1.99 per gallon Friday, retail tracker GasBuddy said. The nation followed Texas and upper-Midwest states that went under the $2 threshold earlier in March.
The decline comes as coronavirus-related lockdowns halt transit across the country and as Saudi Arabia’s price war with Russia has fueled a global glut of both crude and refined products.
Gasoline pump prices followed futures lower. The Nymex April RBOB contract last week fell under 50 cents a gallon -- the price before retail markup, blending costs and taxes -- leaving wholesale value comparable to the price of a U.S. postage stamp.
”This is the first time in history that we have seen a big reduction in gas prices without a corresponding increase in demand,” said Nancy McGuckin, a travel behavior consultant in Southern California.
The pain is acute for U.S. refiners who are confronted with negative refining margins and are being forced to throttle back operations.
The next threshold ahead for retail gasoline, $1.50 a gallon, last was reached in 2004 during President George W. Bush’s first term.
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