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Motorists are enjoying continued savings at gas stations as fuel prices maintain their downward trend. According to AAA's latest fuel price report, the average cost for a gallon of regular gasoline is now $2.95, down one cent from last week and 10 cents lower than prices one month ago.
The current local average sits below both the state average of $2.97 and above the national average, which AAA reports at $2.88 as of Monday (January 26).
This continues a pattern of relatively low winter gas prices, which experts attribute to seasonal factors. "Pump prices are typically low in January thanks to a dip in gas demand and cheaper winter blend gasoline," according to AAA's mid-January assessment. The organization noted that while the national average had nudged up slightly to $2.84 by January 15, prices remain significantly lower than last year's $3.08 average.
The Energy Information Administration (EIA) reports that gasoline demand increased slightly last week from 8.17 million to 8.30 million barrels per day, while total domestic gasoline supply rose from 242 million barrels to 251 million. Despite this small uptick in demand, prices have remained stable or declined in many regions.
Oil market dynamics continue to play a crucial role in determining pump prices. Crude oil inventories increased by 3.4 million barrels according to recent EIA data, putting U.S. crude oil inventories about 3% below the five-year average for this time of year.
Geopolitical factors could potentially impact future prices, as markets continue monitoring tensions in Iran, a major OPEC member and global oil producer. Any disruption to Iran's oil infrastructure could affect gas prices domestically.
For drivers seeking the lowest fuel prices, states like Oklahoma ($2.32), Texas ($2.42), and Kansas ($2.42) currently offer the most affordable gas in the nation. Meanwhile, Hawaii ($4.40), California ($4.21), and Washington ($3.79) maintain their positions as the most expensive markets.