On August 25, 2025, small business owners nationwide received some welcome news as gasoline prices took a dip ahead of the Labor Day weekend. The average retail price for regular gasoline fell to $3.15 per gallon, representing a 5% decrease—or 17 cents per gallon—compared to last year. This decline could provide tangible benefits for businesses that rely on transportation and logistics, particularly during a busy holiday weekend.

Falling crude oil prices are largely responsible for this drop. Brent crude oil, a global benchmark, averaged $67 per barrel during the first part of August, a significant 15% reduction from the same month in 2024. The Energy Information Administration (EIA) forecasts that gasoline prices may continue to decrease by approximately 11%, or an additional 35 cents per gallon, between August and December. This trend is attributed to increased global oil supply and seasonal shifts in gasoline production, such as the transition to less expensive winter-grade gasoline.

For small business owners, these lower fuel prices can lead to an array of practical applications. Especially for those in logistics, delivery services, or other transportation-dependent sectors, the reduction in fuel costs can enhance profit margins. “Lower fuel costs can help small businesses manage overhead better and allow them to pass on savings to consumers,” emphasizes industry expert Alex de Keyserling, a principal contributor to the report.

The benefits of reduced gasoline prices extend beyond the balance sheets. In the competitive landscape, businesses with fleets can optimize their budgets, potentially increasing service frequency or reducing delivery times without additional costs. Additionally, businesses heavily reliant on supply chains can expect some relief, making it easier to navigate the current economic climate characterized by fluctuating costs.

However, small business owners should remain aware of regional gasoline price discrepancies as these can affect their operational costs. For example, the West Coast has reported an increase in gasoline prices compared to last year due to a combination of factors including limited refinery access, state taxes, and specific gasoline specifications that raise production costs. In contrast, Gulf Coast states enjoy some of the lowest gasoline prices in the country, thanks to an abundant refining capacity and lower taxation.

While lower gasoline prices can lead to operational savings, owner’s focus should also extend to planning strategically for potential challenges that may arise. The relationship between supply and demand can shift quickly; unpredicted spikes in crude oil prices or geopolitical factors could quickly impact affordability again. Those who rely heavily on fuel should consider strategies for hedging against sudden cost fluctuations, such as establishing fuel surcharges or negotiating fuel prices with suppliers.

In conclusion, as we approach the Labor Day weekend, small business owners have the opportunity to streamline operations and potentially enhance their competitiveness through lower gasoline prices. The decline in fuel costs can ease budgets and optimize logistics, provided they strategize around the inherent regional price variances and stay prepared for fluctuations in the market.

For further details on these gasoline price trends and forecasts, visit the original report at the EIA’s website.

Image via EIA

This article, “Gas Prices Dip to $3.15 Ahead of Labor Day, Marking 5% Yearly Drop” was first published on Small Business Trends