It’s not even Labor Day yet, but already prices at the pump are well into their late summer seasonal sell-off. According to AAA, the national average price of a gallon of gas currently stands at $2.45 per gallon. While that represents a YTD increase of 9.2%, we would note that since 2005 there have only been two other years where gasoline prices were up less YTD than they are now. As shown in the table to the right, the only two other years where gas prices saw a smaller YTD increase were in 2010 and 2014. Furthermore, the average YTD increase at this time of year is 22.5%, so 2015 is shaping up as well below average in terms of prices.
The chart below compares the national average price of a gallon of gas in 2015 to a composite of all years since 2005. Outside of two brief periods in late February and earlier this summer, gasoline prices have generally been tracking below average in terms of their YTD percent change. While it is typical for prices to level off during the summer driving season before drifting lower around Labor Day, this year prices began to plummet around July 4th.
Not only are prices up less than average this year, but relative to last year they are still sharply lower. Below we show the Y/Y change in prices going back to 2006, and at current levels prices are down nearly 29% compared to last year’s price of $3.43. That’s right, a gallon of gas is now a buck cheaper this year compared to last year.