Alabama could see $1 gas this year

Gas stations across Alabama started dropping their prices under $2 a gallon this week, and those prices could be headed a lot lower in the next three months. The market can be hard to predict, but if prices follow the seasonal patterns of recent years then Alabamians could be buying gas for less than $1 a gallon this December.

The state average was $2.05 on Thursday according to price-tracking and analysis site GasBuddy.com. That was the second-cheapest average in the nation and more than $1 cheaper than this time last year. Prices had dropped about a nickel since Monday.

That’s despite the fact that gas is normally at its most expensive in late summer. Last year, the average price dropped more than $1.30 from the end of August to the end of December as producers switched to cheaper-to-make winter blends.

If this year’s winter drop is similar, the state average would fall under $1 a gallon for the first time in more than a decade. A seasonal price drop that’s even half as steep as last year would send prices here under $1.40 a gallon.

Gas Buddy analyst Gregg Laskoski cautioned against banking on 99-cent gas because “you never know what could happen,” but he said even the conservative predictions look promising for consumers. Gas Buddy predicted lower prices throughout the year because of increased supply, but that drop has been accelerated by the spiraling price of crude oil.

“It’s really extraordinary,” Laskoski said.

He said overseas oil producers have continued to push prices lower to put pressure on domestic producers and reduce their profits. That battle has sent crude values into a tailspin.

“Domestic production has really been a game changer,” Laskoski said. “(Overseas producers) want to do as much as they can to reduce domestic production in the United States.”

Nationwide gas prices have dropped at around the same rate as statewide prices, but Alabama’s average is among the cheapest because of the low gas taxes here. Only South Carolina had a lower average on Wednesday.

The oil price battle may lead to wild fluctuations in the market down the road, but for now state motorists are enjoying the lowest late-summer prices since 2005. And the cheaper gas blends are still on the way.

“That’s really set the stage for the way we move into September,” Laskoski said.