Gas Prices at $4.29 Put October on Pace for a Record High

The national average price for a gallon of regular gasoline stood at $4.29 on Friday, October 23, according to AAA, and the motoring group says this month is poised to set a record as the most expensive October ever for gas prices.

The average is down about 20 cents from a week earlier, AAA said in an October 22 news release, but it is still more than a dollar higher than the same time last year. Transport Topics, citing AAA figures, put the year-ago average at $3.07 a gallon. A 15-gallon fill-up at the current average costs about $64, against about $46 a year ago.

October records have now followed similar records set in August and September of this year, AAA said. The national average has stayed above $4 a gallon since late July, through the fall months when prices usually fall.

Why prices are not falling

Crude oil is the main reason. Brent crude traded above $114 a barrel early on Friday, its highest level in more than five months, after attacks in Saudi Arabia raised fears of further disruption to energy supplies from the region, Reuters reported. Concern over shipments through the Strait of Hormuz has kept pressure on fuel prices for weeks, and our reporting this week has tracked oil flows through the strait falling as ship attacks hit a record.

Demand is not the driver. New data from the Energy Information Administration, cited by AAA, showed gasoline demand falling last week from 8.76 million barrels a day to 8.40 million, while total domestic gasoline supply rose from 204.7 million barrels to 208.3 million. Gasoline production eased from 9.34 million barrels a day to 9.23 million.

What drivers can expect

AAA said the cost of gas is ticking upward again after the dip of the past week, and that what happens next depends largely on crude prices. As long as Brent stays near its five-month high, the usual autumn drop at the pump is unlikely to arrive on schedule. The October record would be a monthly average record for October only, not an all-time high: the national average peaked above $5 a gallon in June 2022, according to AAA price records.

Prices vary widely by state. AAA state releases this week put Tennessee at $3.83 a gallon and Georgia at $3.73, both well below the national average, while drivers in California paid above $6 a gallon this week, the highest in the country. Tennessee drivers are paying about $58 to fill a 15-gallon tank, against about $40 a year ago, AAA said.