Gas Heads Toward $3.60 for Thanksgiving as Saudi Output Surges, but Burning Tankers and a Siberian Refinery Strike Keep Oil on Edge

Americans driving to Grandma's for Thanksgiving are on track to pay a good deal less than they feared a month ago. AAA's national average for regular gasoline stood at about $3.91 a gallon on Thursday, down from $4.10 a week earlier and $4.36 a month ago, Newsweek reported ^[1]. Only California and Hawaii are still above $5 ^[1].

GasBuddy's head of petroleum analysis, Patrick De Haan, told Newsweek he expects the national average to reach $3.59 to $3.69 by Thanksgiving, with diesel at $5.85 to $5.95, as prices fall "slightly faster than anticipated" ^[1]. AAA's 3.6-cent drop on Wednesday was the biggest single-day decline in 18 years, according to OilPrice.com ^[6].

Saudi Barrels Come Back

The biggest reason is supply. Saudi Arabia told OPEC it pumped 10.563 million barrels a day in October, up 26% from 8.372 million in September and the most since February, close to its prewar level of about 10.9 million, OilPrice.com reported ^[2]. Not all of it reached buyers: about 9.2 million barrels a day went to market, with the rest going into storage ^[2].

The broader group is recovering, too. OPEC+ output rose by about 2 million barrels a day in October to 41.23 million, according to secondary-source estimates cited by OilPrice.com, while Iran's production fell to about 1.91 million barrels a day, its lowest in 40 years ^[2]. The group's ministers meet Nov. 29 to set targets for 2027 ^[2].

Prices Still Swing Day to Day

Crude has been whipsawed by every headline from the Gulf. Brent jumped nearly 3% on Wednesday to about $93.90 a barrel after Iran denied holding any talks with Washington, and West Texas Intermediate rose nearly 2% to about $87.98 ^[6]. In Asian trading early Thursday, both benchmarks gave back more than a dollar, with Brent near $91.32 and WTI near $85.32, as traders weighed peace hopes ^[5]. Even with the bounces, Brent had lost about 21% since Nov. 1 ^[6].

The risks have not gone away. Iran's Revolutionary Guards said two supertankers carrying more than 4 million barrels of oil were ablaze in the Strait of Hormuz after an explosion, blaming the ships for using an unapproved southern route, and Iranian state television said the vessels struck mines, The Times of Israel reported ^[3]. The paper noted that other tankers were hit earlier in the week and that the speaker of Iran's parliament said the strait will not return to its prewar status ^[3]. OilPrice.com reported that 37 ships were attacked in October ^[6].

Russia's Biggest Refinery Under Fire

Thousands of miles to the north, drones struck the Omsk refinery in Siberia, Russia's largest, in an attack that lasted more than eight hours on Wednesday, the Kyiv Independent reported ^[4]. The Gazprom Neft plant, about 2,500 kilometers from Ukraine, produces roughly one in six liters of Russia's gasoline and diesel ^[4]. The regional governor told residents to stay indoors and said crews responded to sites hit by falling drone debris ^[4]. It was at least the third attack on Omsk this year ^[4].

What It Means for Your Wallet

For American families, the near-term news is good. Lower pump prices act like a tax cut at exactly the time of year when budgets are stretched by travel, groceries and Christmas shopping. More oil flowing to market is doing what lectures from climate summits never do: bringing prices down.

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But the market is a hair trigger. Analysts at ING said the uncertainty around Iran continues to give prices some support, and an analyst at Nissan Securities said markets are betting on quiet diplomacy behind the scenes ^[5]. A single serious attack on a Gulf shipping lane, or a breakdown in talks, could erase weeks of savings in a day.

The next dates to watch are the U.S.-China summit next week, the OPEC+ meeting on Nov. 29 and, for drivers, the Thanksgiving weekend itself, when GasBuddy's forecast will be put to the test ^[5][2][1].