Here’s a sight that many people thought they’d never see again: Gas at less than $2 a gallon. Gas prices in Alexandria dipped below the $2 mark Friday. It’s the first time in five years that gas has been that low in the state.
Because of the low prices, travel experts are predicting record-breaking travel numbers this holiday season.
The low prices are likely to stay for at least a month, possibly into March, before leveling off and climbing again, according to Gregg Laskoski, senior petroleum analyst with GasBuddy, the company that operates Minnesotagasprices.com, a crowd-sourced website.
Laskoski said the underlying reason for dropping gas prices is the price of crude oil, which has dropped from $110 a barrel in June to Friday’s $56 a barrel. Despite falling prices, OPEC isn’t reducing its production overseas, further fueling the declining prices.
As Laskoski explains it, OPEC is trying to push prices low enough to shut down the more costly production of oil from shale formations in the U.S. That production has boosted the U.S.’s inventory of gasoline.
“A lot of that production can only proceed if they’re profitable,” he said. “A lot of projects that could have been profitable at $80 a barrel are not at $55 a barrel. As a result, though, we are seeing these crude prices go extremely low.”
Some information is from the St. Paul Pioneer Press, a media partner with Forum Communications Company, which includes the Echo Press.
