Gas Prices Likely Headed Below Year-Ago Levels
With the national average for retail gasoline at $2.86 a gallon, down $1.25 from the all-time high and just 4 cents higher than where it was a year ago, it's a pretty good bet that gas prices will be below where they were a year ago by the weekend. That hasn't happened in 14 months!
With expectations for gas prices to head to $2.75 a gallon or lower by the end of the month, plummeting prices are likely to have a real impact on the economy.
Drivers are saving about $55-$65 per month compared with what they were paying in July, when gas prices were over $4 a gallon, according to Tom Kloza at the Oil Price Information Service.
Over the last 2 1/2 months, they've saved only about $10 per month versus the same period last year.
Wal-Mart CEO Lee Scott told CNBC Wednesday: "When people put $10 less in their car in gas or $20 less in gas in their car in a week, that's disposable income they have that they can now go to a sit-down restaurant or go to a movie or they can come shop at Wal-Mart."
Even then, shopping trips are likely to be less frequent. A survey released today by Deloitte and Touche shows that 68 percent of Americans intend to change the way they shop due to the economy, and more than half plan to consolidate shopping trips to save on gas.
After all, just two years ago, gas prices were nearly 27 percent lower at $2.20 a gallon.