Gasoline prices have declined as U.S. crude oil prices have plummeted from $110 a barrel at the end of August on concerns about a possible U.S. strike against Syria to below $95 a gallon, the lowest price since June, as domestic crude supplies have risen sharply in recent weeks.
Meanwhile, the end of the summer driving season has resulted in an abundant supply of gasoline, with inventories up 7 percent from a year ago, and demand has declined. "There's little demand in the fourth quarter and plenty of supply out there. Fundamentals have finally taken center stage," said trader Anthony Grizanti of GRZ Energy and a CNBC contributor.
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A seasonal shift in gasoline processing has helped to lower prices at the pump too. "It costs about 10-15 cents less to make the winter-blend of gasoline than the summer blend," said AAA spokesperson Michael Green.
As a result of all of these factors, gasoline prices haven't been this cheap since 2010, having fallen 34 cents since Labor Day and 22 cents from a year ago. Even in the high-priced New York metropolitan area, pump prices fallen dramatically after topping the $4 mark a year ago, when Hurricane Sandy damaged local refineries.
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Local gas prices are about 40-50 cents cheaper in New Jersey, Long Island and New York City than the first weeks of November last year. The state-wide average in New Jersey is $3.14 a gallon and in New York City prices are about $3.63 a gallon on average, according to AAA.
While the national average may not fall below $3 a gallon, many analysts say prices should remain under pressure through the New Year.
"Prices probably won't start to rise again until Valentine's Day as we anticipate the spring and summer driving season of 2014. But for now, this market is very well supplied," Grisanti said. Drivers have been paying less than they did a year for gasoline for the last three months and that trend is likely to continue.
—By CNBC's Sharon Epperson. Follow her on Twitter: @sharon_epperson