Talking Points: Will Gas Prices Continue To Fall?
MINNEAPOLIS (WCCO) -- Sticker shock at the pump continues in the Twin Cities and around the nation. And for motorists filling up, it's the good kind of shock.
It's now possible to find gas at less than $2 a gallon at many stations across the state. These are the lowest prices in more than five years, and it's less than half of what Minnesotans paid back in May of 2013, when supply problems sent gas prices over $4.20 a gallon.
Increased production in the U.S. and declining demand because of weak economies in Europe and Asia are getting the credit for the drop.
But will these low prices stick around? And how low will they go?
Professor Akshay Rao of the Carlson School of Management is a nationally-known gas pricing expert. He was a guest on WCCO Sunday Morning.
"My instinct is that come this summer, when driving patterns change, prices will again rise," Rao said. "Prices for a commodity such as gasoline are driven by forces supply and demand, and supply today is higher than it has been historically and demand in the winter tends to drop."
Another major factor keeping prices low is that OPEC - the Organization of Petroleum Exporting Countries -- has not cut its production.
OPEC appears willing to let prices continue to slide in an apparent effort to force a slowdown in U.S. production. And as long as that global gamesmanship continues, consumers at the pump will benefit.
You can see WCCO Sunday Morning with Esme Murphy and Kylie Bearse every Sunday at 6 a.m. and 10:30 a.m. To see the full interview with Professor Akshay Rao, watch the video above.
To find the cheapest gas near you, click here.
