Motor club AAA reports a national average price for a gallon of regular unleaded gasoline Thursday at $3.47, down 14 cents from last month and 6 cents less than this date in 2013. Michael Green, a spokesman for AAA, said in an interview most people in the United States still think that's too high.
"According to our research, about half of Americans consider the cost of gas to be too high when the price reaches $3.30 per gallon," he said.
While on the presidential campaign trail in 2012, former House Speaker Newt Gingrich said gasoline prices could fall to as low as $2 per gallon if more emphasis were placed on domestic energy production.
The U.S. Energy Information Administration, part of the Energy Department, said around 6.7 billion barrels of oil per day were produced domestically in 2012. Full year 2014 output should be 8.5 million bpd and rise to 9.3 million bpd next year, which would be the highest annual average level of production since 1972.
EIA ranks the United States second only to Saudi Arabia in terms of oil production thanks in part to new drilling technology for shale reserves. In April, EIA said six shale basins -- Bakken, Eagle Ford, Haynesville, Marcellus, Niobrara and Permian -- together accounted for almost 90 percent of the growth in U.S. oil production and nearly all of the gains in natural gas.
That trend in oil production hasn't been replicated elsewhere in the world, however. Global demand, meanwhile, has increased, most notably in the economies of the Asia-Pacific and China.
Analysis from the International Energy Agency, based in Paris, says global oil demand will be around 1 million bpd for 2013, lower than it previously estimated because of economic issues. With recovery emerging, IEA says global demand for oil should increase by 30 percent next year.
All that supply and demand translates into what are, relatively speaking, high oil prices. The U.S. benchmark for crude oil, West Texas Intermediate, is just under $98 per barrel, compared with $30.78 a decade ago.
"It is estimated that every $1 per barrel rise in the price of crude oil increases gas prices by 2-3 cents per gallon," Green said. "On this day ten years ago, a gallon of gasoline cost $1.86 per gallon and today it is $3.47 per gallon."
Meanwhile, while the United States is restricted in how much crude oil it can send to an energy-hungry global market, refiners can export as much gasoline as they want. When gas prices at home decline, those in the refinery sector can look for a better price overseas, where some countries pay the equivalent of $10 for a gallon of gasoline.
Green explains that puts a limit on how low gasoline prices in the U.S. market can go.
In today's dollars, the average price per gallon based on Gingrich's predictions would be $2.08 per gallon.
"Regrettably we may never see a return of $2 gasoline, but we do not expect a national average above $4 per gallon soon either," Green said.