California Gas Prices Dip Below $5 for First Time Since July

National Pump Prices Have Fallen for 53 Straight Days
California gas station
Gas prices are advertised at over eight dollars a gallon in Los Angeles in 2022. (Marcio Jose Sanchez/Associated Press)

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California pump prices fell below $5 a gallon for the first time since July, following national levels lower but still the highest in the country.

Regular gasoline costs an average of $4.98 a gallon in the Golden State after topping $6 in September, according to data from the American Automobile Association. An initial drop in prices was prompted by Gov. Gavin Newsom’s decision to waive an anti-smog rule, allowing for the use of cheaper winter-grade fuel — which can be made from a wider, less costly pool of components — earlier than usual.

Still, California’s stricter environmental compliance is keeping gasoline more than $1 more than the national average, which is $3.308 per gallon, the lowest since January. National pump prices have fallen for 53 straight days.

Demand hit a 25-year seasonal low in October and remains below the five-year average with previously sky-high prices and inflation pushing down on discretionary driving. Crude futures, which have a direct relationship with pump prices, are down 5% for the year following a run of four weekly losses after the Israel-Hamas war premium faded and supply concerns returned to the fore.

Gas prices chart

The U.S. Thanksgiving travel period might provide a momentary tailwind to demand. It’s slated to be the third highest in records going back to 2000 with 49.1 million Americans expected to drive, an increase of 1.7% compared to 2022.

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