Demand for gas drops to lowest levels since early days of COVID-19 pandemic

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According to AAA, gas prices have been falling since mid-June as demand has fallen to levels not seen since the early days of the pandemic.

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Prices have declined steadily since June 14, when the average US price hit a record high of $5.01 per gallon.

On Thursday, the national average price for a gallon of regular gasoline fell eight cents to $4.13.

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new data from Energy Information Administration (EIA) shows that gas demand declined last week from 9.25 million barrels per day to 8.54 million barrels per day.

According to AAA, this is 1.24 million barrels per day lower than last year and “in line with demand at the end of July 2020”, when there were widespread virus-related restrictions and fewer people were taking to the streets.

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“Despite the steady reduction in pump prices, drivers are still changing their driving habits to combat higher-than-usual prices,” AAA spokesman Andrew Gross told Fox Business on Thursday.

Consumer demand for gas has not seen a decline since the start of the pandemic.
Newsday via Getty Images

The latest demand figures bolster a recent AAA survey that showed 64% of drivers had changed their driving habits or lifestyle To offset the higher prices at the pump since March.

However, there may be some good news for the drivers.

Recently, crude oil prices have declined as concerns over weak gasoline demand continue.

Petrol pump
Deflationary demand can cause prices to fall even further.
AFP via Getty Images

According to AAA, if the demand for petrol remains low and crude oil prices do not rise, the pump prices are likely to continue to decline.

Even though the Organization of Petroleum Exporting Countries (OPEC) and its alliesOPEC+, also known as OPEC+, plans to increase production to only 100,000 barrels per day in September after increasing production by 648,000 barrels per day in July and August, according to the AAA report, with a significant impact on the price. Not likely to fall.

“Slight growth unlikely a significant pricing impact, Especially if demand continues to decline,” AAA said.

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