Cary, NC – Thanksgiving is one of the biggest travel days of the year, which typically means more demand for gasoline. This year, with a mix of seasonal and market factors, prices have dropped drastically right before the holiday.
Prices Drop Ahead of Thanksgiving
According to data from AAA, gasoline prices in the Cary area have dropped nearly five cents per gallon over the past weeks. Currently, the average gas price in Cary is $2.410 per gallon. One month ago, the average price in the area was $2.451 per gallon and one week ago, it was $2.434 per gallon.
Gasoline prices are often lower in the Autumn and Winter months but this is still significantly lower than prices this same time last year, which were $2.546 per gallon.
While prices in Cary are dropping, relatively speaking, Cary and Wake County in general have some of the highest prices in the state. The average gasoline price in North Carolina currently is $2.381 per gallon. Neighboring counties to the South, including Chatham, Johnson and particularly Lee and Harnett, have lower prices, while Durham, Orange, Nash and Granville Counties have higher prices. Franklin County and Wake County are roughly the same.
For now, prices are still trending down but with the big travel holiday coming up, that may change, but only temporarily.
“We would expect this trend to continue throughout most of the month, but the exception is Thanksgiving,” said Jeanette Casselano, AAA spokesperson. “With nearly 49.3 million Americans expected to travel by car for the holiday, gas prices may start to fluctuate by the end of this week.”
However, as much as prices are dropping now, they are still higher than they were at this same time in 2017 and significantly higher than they were in 2016.
What’s Behind Price Drops?
There are two key factors behind the recent drop in gasoline prices. One is a consistent seasonal trend: gasoline is cheaper to produce in colder months. There is a Summer and Winter “blend” of gasoline, with the Summer blend adding in additional chemicals to counteract evaporation. Since the Winter blend does not contain these chemicals, it is cheaper, resulting in lower prices at the pump.
Additionally, prices are typically lower because of lower demand as fewer people drive in the Autumn and Winter months. However, as driving, car ownership and overall gasoline demand has grown at a rapid pace, this seems like a less relevant factor nowadays.
The other factor behind these recent price drops is an increase in gasoline supply, even as demand has hit 9.32 million barrels per day, which is up from 9.19 million at the start of November 2019.
“An increase in gasoline stocks amid robust demand helped to push gas prices cheaper on the week,” Casselano said.
Last week, United States gasoline stocks grew by 1.9 million barrels, according to the Energy Information Administration. However, domestic stocks are still significantly smaller than they were at this same time last year – 7.5 million barrels lower to be exact – even though prices are lower now then they were at this time in 2018.
Story by Michael Papich. Photos by AAA and Mike Mozart.