New York CNN Business —
The great gasoline spike of 2022 has completely unwound, giving consumers a major boost after a year of high inflation.
The national average for regular gasoline dropped to $3.14 a gallon on Monday, according to AAA. Gas prices haven’t been this low since July 2021.
After moving steadily higher last year, pump prices spiked early in 2022 following Russia’s invasion of Ukraine. The national average topped out at an all-time record of $5.02 a gallon in June.
But prices have since cooled off and the decline has accelerated in recent weeks. The national average for regular gas has tumbled 12 cents in the past week and 54 cents in the past month, according to AAA. It’s 17 cents cheaper, on average, to buy gas than the same date last year.
Patrick De Haan, head of petroleum analysis at GasBuddy, told CNN on Friday that the national average could drop below $3 a gallon by Christmas Eve.
Twenty-one states already have averages below $3 a gallon, including Ohio, North Carolina and Colorado, according to AAA. In California, the state average for regular gas has dropped to $4.38, down from a record of $6.44 in June.
The plunge in gasoline prices has been driven by a variety of factors, including soft demand, recession fears, rebounding supply and the absence of a major disruption to Russia’s oil flows.
Sandy Sherman, a resident of Olathe, Kansas, said the sharp decline in pump prices means he can use the extra money for clothing, food and other household necessities.
“Gas where I live never got close to $5 a gallon but anything over $4 a gallon is a major issue,” Sherman said. “We can only hope that the decline continues!”