The most obvious determinant of gas prices – making up 67 percent of the price according to the US Energy Information Administration – is the cost of the resource gas comes from: crude oil. Fluctuations in gas prices tend to track fluctuations in crude – and currently, with oil prices sliding to the lowest levels in years, gas prices are sliding as well.
That fall in oil prices is the result of booming North American production, Saudi Arabia’s hesitance to cut output, and a drop in Asian demand. For more on why crude oil prices have fallen 25 percent over the course of summer 2014, check out the Monitor’s explainer on the precipitous oil price drop.