With oil prices crashing over 20% from their recent highs, one welcome effect of the decline is less pain at the pump. According to AAA, the national average price of a gallon of gas is currently $2.72 per gallon which is down 6.5% from just one month ago. The table below lists the average price and YTD change of a gallon of gas as of 11/8 going back to 2005. What’s really amazing about the current price and performance is that it is about as average as it gets. The current price of $2.72 is just 1 cent below the average price of $2.73 as of 11/8 going back to 2005, and the YTD change of 9.5% is within one percentage point of the average 10.1% YTD change.
Gas prices have followed their typical seasonal movement throughout the year pretty perfectly in 2018. The chart below compares the YTD percentage change in gas prices this year to a composite of the YTD change in prices for all years since 2005. As you can see, the pattern this year has been extremely similar to the historical pattern.
When looking at gas prices, a good way to think about things is how do prices this year compare to where they were at this same time last year? Along those lines, the chart below shows the y/y change in gas prices since 2006. At current levels, the average price of a gallon of gas is up 6.5% from the same point last year. While prices are higher, we would note that the y/y rate of change is right near its lowest level in a year, and if recent trends continue, that y/y rate of change is likely to keep drifting lower.