Drivers are on track to save a significant amount of money this summer thanks to low gasoline prices that are likely to stay below $2.50 per gallon, the Energy Information Administration (EIA) predicted.
The average gasoline price for the summer will be $2.45, the EIA forecast Tuesday in its Short-Term Energy Outlook report. Prices will fall from $2.50 this month to $2.43 in September.
That is far below last year’s average of $3.59 a gallon over the summer and in line with the averages from recent months, the EIA said.
This will translate into sizable savings for drivers, it added.
“Based on EIA's gasoline price forecast, the average U.S. household is expected to spend about $700 less on gasoline in 2015 compared with 2014, as annual motor fuel expenditures are on track to fall to their lowest level in 11 years,” the agency said in its report.
The low prices are due mostly to crude oil prices, which plunged last year and lost about half their value, with international supply greatly exceeding demand.
Crude oil on the Brent benchmark, which is an international price marker, are forecast to average $58 per barrel this summer, down from $106 a barrel last summer.
Diesel fuel is projected to average $2.77 a gallon this year, down from $3.39 last year.
Gasoline consumption is likely to grow 1.6 percent to an average of 9.2 million barrels a day, the EIA said.
Highway travel will grow 2.5 percent, but the demand from that will be offset partially by a 0.9 percent increase in the fuel efficiency of vehicles.