Gas Prices in 1984

The average price fell 2.5% in 1984, to $1.11 a gallon. After inflation the decline was 6.6%, to $3.45 in 2025 dollars. It was the third consecutive annual decline in both measures.

The Iran–Iraq War continued, and in 1984 it spread to shipping in the Persian Gulf: in what became known as the “tanker war,” dozens of ships were attacked by Iraqi or Iranian aircraft or damaged by mines over the following months. The attacks did not produce a sustained rise in prices. World oil supply exceeded demand, OPEC was holding its members to quotas to defend its official price, and Saudi Arabia was reducing its own output to keep the market in balance.

The economy grew strongly in 1984 after the recession ended in late 1982, which raised fuel demand, but the annual gasoline price still fell. After inflation, the years 1982 through 1985 form a steady decline from the 1981 peak rather than a single drop; the sharp fall came in 1986.

The pump price barely changed between 1984 and 1994: the later year was just 0.4% higher, at $1.12. Over the same ten years the value of that price in 2025 dollars fell 29.6%. Twenty years out, 2004 cost 66.6% more at the pump but still 8.4% less after inflation. No year after 1984 cost more in real terms until 2005, when the constant-dollar average reached $3.75.

In the full record, 1984 ranks 40th-highest in current dollars and 22nd-highest in 2025 dollars. Its real average of $3.45 falls just between two mid-1970s years, 1975 ($3.47) and 1976 ($3.43).

Missouri had the cheapest gasoline of the 51 at $1.06, with Arkansas, Georgia and Oklahoma next. New York ranked 7th from the cheapest, a position it matched in 1985 but never bettered in the SEDS series. Hawaii remained the most expensive at $1.45, 33.9¢ above the national average, followed by Alaska ($1.26) and the District of Columbia ($1.23). The distance between Missouri and Hawaii was the widest the SEDS series had shown up to that year.