With oil prices hovering near 11 year lows some analysts are now asking if U.S. gasoline prices could approach the $1 per gallon mark.
According to 24/7 Wall St, low crude prices, record high supply levels and strong refinery activity could push nationwide gas prices close to the $1 mark, a price point not seen since 1999.
A report published last month by the American Automobile Association found that U.S. drivers are paying the lowest average price for regular unleaded gasoline since 2009.
Despite low crude prices and an over 50 percent drop in the U.S. oil and gas rig count, crude inventories continue to swell.
U.S. commercial crude oil inventories, excluding those in the Strategic Petroleum Reserve, ended last week at 482.3 million barrels, the highest level in at least 80 years despite a 5.1 million barrel draw down, according to the U.S. Energy Information Administration (EIA).
West Texas Intermediate was trading at $31.60 per barrel near noon, down from about $48 per barrel a year ago.
Low gasoline tax levels are also helping pull prices to multi-year lows.
While gasoline taxes are sitting at $0.48 per gallon nationwide, some states have seen taxes drop below $0.40 per gallon, including Oklahoma, South Carolina and Missouri, 24/7 Wall St said.
Taxes account for about 21 percent of the cost of each gallon of gasoline while crude accounts for 46 percent of the cost, according to the EIA.
Regular gasoline prices fell to an average of $1.965 per gallon on Monday, down from $2.139 per gallon a year ago, according to AAA.
In Texas, average gasoline prices are currently at $1.737 per gallon while prices in Oklahoma are at $1.695 per gallon.
Gasoline prices in Missouri are currently the lowest in the nation at $1.656 per gallon.
EIA expects U.S. regular gasoline retail prices to average $2.36 per gallon in 2016.
Total motor gasoline inventories increased by 10.6 million barrels last week, and are now in the upper half of the average range, the EIA said.