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Despite Low Gas Prices, Americans Are Overpaying At The Pump

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Despite Low Gas Prices, Americans Are Overpaying At The Pump

This week, GasBuddy reported that the U.S. national average gas price dropped for the third consecutive week this week, reaching $2.28/gal on Monday.

While U.S. drivers are certainly cheering lower prices, GasBuddy has found that lower gas prices actually increase the chances of overpaying at the pump.

A recent study found that the lower gas prices fall, the higher the variance or “spread” between low-priced gas and high-prices gas in a given city.

“We’re in a relative period of tranquility and affordability at the pump, and so the data suggests Americans are at a particular risk right now of overspending on gasoline,” analyst Patrick DeHaan explains.

Related Link: Trump's Keystone XL Pipeline Approval Will Impact Crude Oil Spreads, Boost Canadian Economy

Among the largest cities in the nation, Washington D.C. drivers are currently at the highest risk for overpaying at the pump. The top 5 percent of gas stations by price in the D.C. area are currently charging an average of $3.42/gal for gas, while the bottom 5 percent of stations are only charging an average of $2.22/gal. That variance represents a 35 percent spread.

In addition to Washington D.C., San Francisco, Los Angeles, San Diego and Chicago all currently have spreads greater than 25 percent.

According to GasBuddy, drivers in South Carolina are currently getting the cheapest gas in the country, at an average of only $2.00/gal. Hawaii drivers are currently paying the most for gas at $3.01/gal.

So far in 2017, the United States Gasoline Fund, LP (NYSE: UGA) is down 14.6 percent.

Posted-In: gas prices GasBuddy Patrick DeHaanCommodities Economics Markets Best of Benzinga

 

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