A Welcome Break for Holiday Travelers
Gas prices are nearing their lowest levels in four years just as tens of millions of Americans take to the roads for Thanksgiving. According to new data from the American Automobile Association, more than 30 states now offer gasoline for under three dollars a gallon. In a few places, prices have dipped even further, with the first sub two dollar reading appearing in Midwest City, Oklahoma, where one station recorded fuel at $1.99 per gallon.
Patrick De Haan, the head of petroleum analysis for GasBuddy, said the trend reflects shifting conditions in global demand and supply. “It’s pretty compelling to see gas prices this low, falling ahead of Thanksgiving, and it signals what more Americans could experience in the coming months,” he explained. He pointed to lower seasonal demand, falling oil prices, and rising OPEC output as key forces driving the declines.
AAA reports that the most common gas price nationwide is $2.99 per gallon. The lowest prices cluster in the South and Gulf states, including Mississippi at $2.53 and Louisiana at $2.55. The bottom ten percent of gas stations are averaging $2.40 per gallon, with scattered stations in Texas and Oklahoma posting numbers close to two dollars.
By contrast, high tax states like California and Hawaii continue to see steep prices. California’s statewide average stands above four dollars per gallon, with some areas exceeding $4.60. Despite these differences, the national average still sits at $3.07, far below the levels seen earlier in 2025.
These prices also place this Thanksgiving close to the cheapest since 2021, when pandemic-driven demand collapse created unusually low fuel costs. Since then, prices have been shaped by global shocks, including conflicts in the Middle East. Earlier this summer, the national average hovered around $3.20 per gallon after Israel and Iran agreed to a cease-fire. Even then, the trend showed slow declines that have continued into the fall.
Why Prices Are Falling
Several key factors are contributing to the drop:
- Lower Oil Prices: West Texas Intermediate crude recently traded near $58 per barrel, marking one of the lowest levels in years. Brent crude, the global benchmark, has fallen about 17 percent since June.
- Refinery Maintenance Ending: Refineries are completing their heavy maintenance season. As De Haan said, “With refinery maintenance now wrapping up, that’s going to mean that refineries are able to ramp up oil into their plants.”
- Seasonal Demand Drop: After the busy summer travel period, gasoline demand typically falls through the autumn months. AAA noted that even with a Thanksgiving travel surge, overall demand is still low for this time of year.
These factors combine to push down retail prices, especially in regions with looser regulations and lighter fuel taxes.
What This Means for Holiday Travel
Nearly 82 million Americans are expected to travel 50 miles or more over Thanksgiving, the highest number on record. AAA Vice President of Travel Stacey Barber said Thanksgiving carries special meaning for travelers. “Thanksgiving travel numbers are always impressive because this holiday has become synonymous with heading out of town to spend time with loved ones,” she said. “People are willing to brave the crowds and make last minute adjustments to their plans to make lifelong memories.”
More drivers on the road also reflect the decision by some air travelers to switch to cars due to recent flight disruptions. Popular destinations this year include Orlando, Miami, Tampa, New York City, San Francisco, Los Angeles, and Las Vegas.
The Policy Backdrop and Trump’s Influence
While global supply and demand remain the main drivers of fuel costs, broader policy decisions over the past several years have created conditions that support lower prices. The Trump administration has pushed for increased domestic energy production, expanded refinery capacity, and incentives for American oil development. These measures have helped shield the United States from some of the volatility seen in international markets.
Trump’s pro-production approach has kept more oil flowing from U.S. fields, especially in places like Texas and North Dakota. The administration has also pressured OPEC and other producers to maintain high output, reducing the likelihood of coordinated cuts that typically raise global prices. The combined effect is a stronger supply base that places downward pressure on retail gas costs.
With crude oil prices already falling and more domestic supply coming online, these policies have helped create an environment where low gasoline prices can persist even during periods of geopolitical tension. As De Haan noted, the trend could continue. “As we get closer to Christmas, I think the news will continue to improve with gas prices potentially falling below three dollars per gallon in the next few weeks,” he said.
GasBuddy and AAA both suggest that prices may dip further into December, especially as winter demand declines. The South and Midwest are likely to see the biggest savings, while the West Coast will continue to face higher structural costs tied to taxes and state fuel regulations.
Drivers planning holiday trips are encouraged to shop around using price-tracking apps and take advantage of discount programs offered by retailers and membership services. With the combination of low crude prices, rising supply, and stable demand, Americans heading into the holiday season have one more reason to be thankful.
