It's official: First gas station drops price to 99 cents

HOUSTON, Texas (KTRK) -- It's official: gas has fallen to 99 cents per gallon.

But not here in Texas.

According to GasBuddy, a BP station in London, Kentucky has lowered its price to 99 cents per gallon. The website said it confirmed the price through a cashier who answered the phone as well as through GasBuddy users who reported the price through the app.

The gas station is the first in the U.S. to reach this price, which was predicted by head of petroleum analysis for GasBuddy Patrick DeHaan.

"We're in uncharted waters due to demand plummeting in light of the coronavirus situation, and yesterday oil prices fell to their lowest level since 2002 in a sign of the deep distress our economy is facing," DeHaan said.

Earlier this week, DeHaan said in a tweet that not everyone will see the prices.

He also noted there are now 16 states, including Texas, where gas prices have dipped to $1.50 or lower. On Tuesday, he said the Lone Star State is at $1.49.

A search of prices in the Houston area as of Wednesday shows the $1.49 price at Fuel Depot on Windfern Road and Summer Harvest.

A little more than a week ago, the oil market took a major hit when Russia and Saudi Arabia could not agree on how to deal with lower prices.

Saudi Arabia slashed prices and increased production, sending the oil market into a freefall. The price of a barrel of oil was down more than 20 percent and was trading around $30 a barrel on Monday, March 9.

The U.S. energy sector employs more than six million people, and for some producers, the sudden fall in oil could lead to layoffs.

Halliburton recently announced it will furlough more than 3,500 employees at its North Belt facility in Houston.

Starting March 23, employees on the mandatory leave of absence will work on one-week on, one-week off for up to 60 days.

RELATED: What Houston-area school districts, health departments are doing about coronavirus

The Associated Press Deputy Markets Editor Seth Sutel has been watching the oil market and said the coronavirus scare has had a ripple effect on a wider scale, including oil and gas.

"What's going on with oil is the price has been falling because, as investors anticipate less travel, less demand for energy, fewer flights, less driving, few factories running, these require energy," Sutel said. "So, when demand for energy goes down, broadly, in the whole world like this, the price of oil goes down."

COVID-19 is threatening the global economy, presenting what some are calling "the greatest threat since the financial crisis."

Analysts believe oil is headed for its biggest one-day decline in nearly 30 years.

The video above is from a previous story.

Map of COVID-19 cases across the US, updated as confirmed by CDC