Energy & Environment — Gas prices down year-over-year

by Rachel Frazin and Zack Budryk - 12/08/22 5:52 PM ET

Gasoline prices are now lower than they were at this time last year. Meanwhile, the defense spending bill has officially moved without Sen. Joe Manchin’s (D-W.Va.) permitting reform, and Virginia is slowly advancing in its attempts to exit a regional climate agreement.

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Gas prices fall below December 2021 level

The average price of gasoline in the U.S. is lower than it was a year ago, after many months of elevated prices marked by Russia’s invasion of Ukraine.

The country’s average price for a gallon of gasoline stood at about $3.33 on Thursday, just under the $3.34 this time last year, according to the AAA.

Gas prices are now at their lowest point since January.

In February, prices shot up following Moscow’s invasion of Ukraine, as some turned away from Russian fuel in protest, reshuffling the market. Prices peaked in June, averaging more than $5 per gallon.

For the past few weeks, gas prices have seen sharp declines. Likewise, oil prices have fallen over the past month.

But why? Patrick De Haan, head of petroleum analysis at gasoline price site GasBuddy, said a range of factors were contributing to the lower prices including:

reduced oil demand from COVID-19 related lockdowns in China
economic concerns as the Federal Reserve is expected to raise rates
high levels of activity at refineries that turn oil into gasoline

What might the future hold? De Haan said that prices at the pump still have a way to fall to reach parity with the decline in crude oil prices.

He said that the national average price is “likely” to drop below $3 per gallon, which he said could occur “right around Christmas.”

The politics: Several White House officials on Thursday highlighted the news on Twitter.

Virginia moves toward exiting multistate climate pact

Virginia’s air quality board on Wednesday voted to leave an interstate emissions-reduction partnership, bringing the state closer to fulfilling Gov. Glenn Youngkin’s (R) vow to withdraw from the program earlier this year even as critics say the process needs legislative approval.

The state Air Pollution Control Board voted 4-1 to continue the exit from the Regional Greenhouse Gas Initiative (RGGI), with two abstentions, an official confirmed. The board comprises four Youngkin appointees and three members appointed by his Democratic predecessor, Ralph Northam.

Virginia joined the RGGI, which counts 11 predominantly northeastern states as members, in 2021, a year before Youngkin took office.
Member states require their power plants to buy carbon credits to offset their emissions.

Youngkin vowed to exit the partnership shortly after taking office, while environmentalists and Democratic lawmakers argued that since the Virginia General Assembly voted to enter the contract, a governor could not unilaterally leave it.

Youngkin signed an executive order requesting the board to consider withdrawal from the RGGI, blaming it for rate increases to utility customers.

The state utility, Dominion Energy, has heavily lobbied for the board to vote for withdrawal, saying in an October letter to the state Department of Environmental Quality that until withdrawal is official, “RGGI compliance costs will continue to accrue in the interim, and subject to regulatory approval, be passed on to customers.”