Oil and Gas

$2.80 gas by Thanksgiving, pro predicts

Lipow's gas price prediticon

Drivers got good news on Friday, with the average price of gasoline in the United States hitting $3 a gallon.

That's exactly what Andy Lipow, president of Lipow Oil Associates, had predicted would happen by Halloween. Now he has a new prediction for prices by Thanksgiving.

"We're going to continue going down and by Thanksgiving I'm seeing $2.80 a gallon," Lipow said in an interview with CNBC's "Street Signs."

"In fact you look at gasoline futures today, they're getting hit hard, another 4 cents a gallon and that's going to be passed on to the consumer over the next few weeks."

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Gas prices are displayed as a customer fuels a vehicle at a Mobil gas station in Peoria, Ill., Oct. 29, 2014.
Daniel Acker | Bloomberg | Getty Images

The price at the pump fell 33 cents in October, thanks mainly to plunging oil prices, according to AAA. Gas is now cheaper than milk. In September, consumers were paying an average of $3.37 per gallon of milk.

However, Lipow doesn't expect further drops into the Christmas season. After the end of November, he sees prices stabilizing "through the balance of the winter into early 2015."

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His biggest concern is a market surprise if Saudi Arabia decides to cut production. As oil prices have been dropping, OPEC has been standing still and not ramping down production.

"Since the market thinks that OPEC is going to do nothing, I think that if Saudis do cut production, that's going to be a surprise to the market to the upside and that's what we'll have to watch out for."

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—The Associated Press contributed to this report.