AAA sees drivers saving $55B to $75B on gas

The rout in crude oil prices may mean as much as $75 billion in gasoline savings for U.S. drivers in 2015, according to AAA.

Americans saved $14 billion on motor fuel last year compared with 2013, AAA, the country's largest motoring group, said by e-mail. Pump prices dropped a record 97 consecutive days to a national average of $2.26 a gallon on Dec. 31, the lowest since May 12, 2009.

A global glut of crude oil and a standoff between U.S. producers and the Organization of Petroleum Exporting Countries over market share has been a boon for consumers. U.S. production climbed in 2014 to the highest in three decades amid a surge in output from shale deposits. Oil capped its biggest annual decline since the 2008 financial crisis. "Next year promises to provide much bigger savings to consumers as long as crude oil remains relatively cheap," Avery Ash, an AAA spokesman, said by e-mail yesterday. "It would not be surprising for U.S. consumers to save $50-$75 billion on gasoline in 2015 if prices remain low."

U.S. benchmark West Texas Intermediate crude dropped 46 percent in 2014 while Brent oil, the international benchmark that contributes to the price of gasoline imports, fell 49 percent.

"It's getting lower because, what happened? We drilled in the United States," Peyton Feltus, president of Randolph Risk Management in Dallas, said Wednesday. "We're buying more of it from ourselves, which is a great economic multiplier."

There is "significant uncertainty" over the cost of crude this year as lower prices may force companies to curb production and may also lead to instability in other oil-producing countries, the motoring group said. Gasoline futures fell 48 percent in 2014 to close at $1.4353 a gallon Wednesday on the New York Mercantile Exchange.

The average U.S. household will save about $550 on gasoline costs this year, with spending on track to reach the lowest in 11 years, the Energy Information Administration said Dec. 16.

Gasoline prices are inelastic, meaning they have little effect on demand for the fuel, Feltus said. That leaves people with more money to spend on other products or save, he said.

Gasoline expenditures account for about 5 percent of household costs, according to the Bureau of Labor Statistics' Consumer Price Index.