Today, at a station near me, the price for regular was $1.55/gal.
As the price at the pump continues to drop, I naturally wonder how low it can go. What is a reasonable floor below which prices cannot fall? At some point it will no longer be profitable for US oil companies, won’t it? Or is it such that at even, say, 50 cents a gallon it is still wildly profitable?
Also, as electric and electric/gasoline hybrid vehicles, such as the Tesla, Leaf, Volt, Bolt, I3, and others become more prevalent, will they impact demand such that prices continue to plummet, or plummet faster?
I recently placed an order for a fully electric car so automobile fuel prices will become an issue of the past for me in a few months, but I have also begun to notice drops in my utility bill, which is great, but again, how low can it go?
Are you talking about the price of gas, or how much consumers pay for it? Because state/federal taxes are almost a buck. I can’t see how it could really get below $1.00.
Heh. According to this gas will only be a dime. I’d like to know how they’re going to get it here and only charge 10 cents. But I’d like to buy a new gas guzzling pick up truck so I’d wish they’d hurry up!
Yeah sure, anything can happen. I’ve seen cost of refining as low as $0.20/gallon and as high as $1.50, so if you have low oil prices at the same time there is a glut in refining capacity. The problem is that the only time this generally happens is when there is a huge slowdown in economic activity. When oil prices are low the refining prices tend to spike a bit as the demand for gasoline increases.
Apparently are other factors in play for the price though.
According to this site, Michigan’s state gas tax is a bit higher than Virginia’s, but the gas here cost a lot more than 1.32 or 1.55. More like 1.90, so there are other factors that may determine final price.
I would say it is not going to get less than $1 in my section of VA.
Average worldwide production cost of one barrel of crude oil fluctuates from $20 to $25. Within this, average per country could be as low as $6 for Saudi Arabia to $48 for UK.