With the new coronavirus scare causing disruptions across the globe and reducing demand for fuel, gasoline prices are likely to also feel its effects.
Oil prices fell Monday by the most in one day since the 1991 Gulf War, plunging after Russia refused to join the OPEC oil cartel in proposed production cuts aimed at supporting prices. Thwarted in its search for cuts, Saudi Arabia, the leading OPEC member, sharply changed course over the weekend by cutting prices and signaling it will ramp up production.
Benchmark U.S. crude fell $10.77, or 26.1 percent, to $30.49.
Demand for energy also is falling as people cut back on travel due to the spread of the coronavirus. Lower crude prices should mean lower pump prices with a lag of about six weeks.
The average price of regular unleaded gasoline in Nevada on Monday was $2.87 per gallon, down from $2.94 a month ago, according to AAA.
The national average is at $2.38 per gallon, down 9 cents year over year, with prices on the West Coast also dropping week-over-week, consistent with the end of the winter driving season and cheaper crude prices, according to Sergio Avila, AAA Nevada spokesman.
“Gasoline supplies on the West Coast are healthy, so we anticipate prices will continue to decrease this week, barring any supply challenges,” Avila said.
In Nevada, AAA expects prices will continue to drop slowly. How low prices go will depend on what happens with crude oil production and demand in the next few weeks.
Although Avila expects gas prices to continue to fall, it is too early to predict if they will fall below $2 per gallon in the Silver State.
“I think it might be a little too early to expect that price to dip under $2 (per gallon), but the price of fuel could certainly dip to under $2 in some markets,” Avila said. “For example, the average price of gas in Texas is currently $2.06.”
The Associated Press contributed to this report.