Gasoline prices could fall below $3 per gallon by Thanksgiving as oil continues to drop on investor concerns over weak demand, one analyst told Yahoo Finance.

Oil prices have dropped roughly 10% over the past month. Additionally, November is usually a weak month for gas consumption, and most refineries are now back online after annual maintenance, OPIS global head of energy analysis Tom Kloza said.

"I think we'll go below $3 per gallon for the average price before Thanksgiving," Kloza told Yahoo Finance.

"Prices are actually much cheaper than they were in the autumns of 2023 or 2022," he added.

Gas stations are also selling winter blend gasoline, which is cheaper than the summer-grade version.

Kloza added, "The question is not so much when do we drop below $3 per gallon, but how much lower can we go?"

On Tuesday, the national average price of a gallon of gas sat at $3.08 per gallon, down $0.12 from a month ago and $0.29 lower than a year ago, according to AAA data.

Twenty-six states are already seeing averages below the $3 threshold, including the Midwest and panhandle states like Texas, Mississippi, and Alabama.

Southeast states like Georgia, North Carolina, and South Carolina have also seen prices fall below that level.

Oil has been volatile following the US presidential elections over concerns that China's weak economy and the possibility of increased tariffs under an incoming Trump administration could weigh on demand.

"Tariffs may ultimately impact trade between the USA and China, negatively affecting the Chinese economy and the growth in oil demand," Andy Lipow, president of Lipow Oil Associates, told Yahoo Finance earlier this week.

A rising US Dollar Index (DX-Y.NYB) has put pressure on oil prices, with futures dropping 5% over the past two sessions.

On Tuesday, West Texas Intermediate (CL=F) hovered around $68 per barrel midday, while Brent (BZ=F), the international benchmark, traded near $72 per barrel.

Earlier in the day, the Organization of the Petroleum Exporting Countries (OPEC) cut its global oil projection growth for 2024 and 2025, marking the group's fourth consecutive monthly downside revision.

Wall Street widely projects oil prices will decrease in 2025, which would help bring down the prices for fuels like gasoline.

The Energy Information Administration predicts gasoline will average $3.20 per gallon next year, down from $3.30 this year.

Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on X at @ines_ferre.

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