National gas prices drop below $3 a gallon just before Christmas travel

The national average price of gasoline in the U.S. has fallen below $3 per gallon, just in time for those traveling for Christmas.

Motorists across the country will most likely see a national average gas price of $2.95 a gallon on Christmas, the lowest number reported since Christmas Day in 2020, according to GasBuddy. As of Dec. 16, 2024, the national average price of gasoline had slightly increased, rising 0.8 cents to $2.98 per gallon, marking the first uptick since October.

"This holiday season is shaping up to be a gift for American drivers, with gas prices presenting a stark contrast to the budget-breaking levels we've seen in recent years and a return to what feels like normal for many Americans filling their tanks," said Patrick De Haan, head of petroleum analysis at GasBuddy.

De Haan noted that gasoline prices are gradually normalizing after the disruptions of the COVID-19 pandemic and the conflict between Russia and Ukraine.

According to GasBuddy, the recent decrease is due to several factors, such as "the Federal Reserve slowing the economy down through higher interest rates, a weak economy in China, the world's second-largest oil consumer, and the ultimate healer: time."

States with the most expensive holiday gas prices in 2024 include Hawaii ($4.58/gal), California ($4.31/gal), Washington ($3.93/gal), Nevada ($3.60/gal), and Oregon ($3.47/gal).

While states with the least expensive holiday gas prices in 2024 include Oklahoma ($2.46/gal), Texas ($2.53/gal), Mississippi ($2.55/gal), Arkansas ($2.54/gal), and Tennessee ($2.62/gal).

In 2021, gas prices dropped due to reduced demand during the pandemic. However, increased economic activity and the impact of certain geopolitical events, like the Russian and Ukrainian conflicts, led to a surge in oil prices.

GasBuddy's 2024 Fuel Outlook projected that the national average price of gasoline would drop from $3.51 per gallon in 2023 to $3.38 in 2024.