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Tennessee gas prices hit 25-month lows

Staff Report • Jan 8, 2019 at 11:28 AM

NASHVILLE – Prices at the pump are off to their lowest start to the year since 2016.

Gas prices in Tennessee dropped another 3-and-a-half cents last week, AAA reported. The state average has declined 71 cents since October.

Tennessee motorists are paying an average price of $1.98 per gallon, the lowest daily average since December 2016, according to AAA. Kingsport’s gas prices are lower than the state average. Prices along Stone Drive Monday averaged $1.89 per gallon.

Compared to last Memorial Day, when the state average peaked at around $2.73 per gallon, Tennessee motorists are now saving more than $11 on a full 15-gallon tank of gasoline.

Looking back

In 2018, Tennessee gas prices averaged $2.49 per gallon for regular unleaded; that was 31 cents more than the year before and the highest annual average price since 2014, AAA reported.

If a Tennessee driver bought a 15-gallon tank of gas every week in 2018, they would've spent an average of $1,942 on gas. That would've been $242 more than what they would've spent the year before.

Most expensive gas prices in the state

• Nashville ($2.06)

• Johnson City ($2.06)

• Jackson ($2.02)

Least expensive gas prices in the state

• Chattanooga ($1.82)

• Cleveland ($1.86)

• Knoxville ($1.92)

2019 fuel outlook

Overall, AAA expects the national average to stay below last year's high of $2.97, set just before Memorial Day. Government data suggests that fuel prices in 2019 will be lower than last year.

The latest Short Term Energy Outlook from the U.S. Energy Information Administration has West Texas Intermediate crude averaging $54 per barrel in 2019; that's $11 per barrel less than last year's average for WTI. An $11 difference in oil prices suggests a 27-and-a-half cent discount at the pump, according to AAA.

In 2018, U.S. gas prices averaged $2.72 per gallon. AAA expects that average to land somewhere in the $2.50s this year.

“Motorists should expect low gas prices to linger through January, as gasoline demand is typically the lowest of the year,” said Mark Jenkins, AAA spokesman, in a press release. “Although pump prices could become somewhat volatile this month, drivers will notice a significant increase in the spring, with the upward trend beginning as early as February.

“Putting global supply and demand fluctuations aside, gas prices often rise 30-70 cents in the spring as gasoline demand increases, refiners conduct seasonal maintenance and begin to switch to a more expensive-to-produce summer blend gasoline. AAA expects pump prices to peak around $2.75 this year, but there is higher potential if a hurricane threatens gulf coast refineries, or there are sizable swings in fuel supplies or the economy.”

National stats

The national average price for gasoline is $2.24 per gallon, which is the lowest daily average since July 2017, AAA reported. On average, Americans are paying 67 cents per gallon less than they did three months ago, amounting to a savings of $10 for a full 15-gallon tank of gasoline.

U.S. gas prices averaged $2.72 per gallon in 2018, compared to an average of $2.39 per gallon in 2017. The highest daily average price in 2018 was $2.97 per gallon.

To view daily gas price averages, visit GasPrices.AAA.com.

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