[I think this example will clear your doubt][1].

> Let’s say Nick searched for [bacon] and URLs from your site appeared
> in positions 3, 6, and 12. Jane also searched for [bacon] and URLs
> from your site appeared in positions 5 and 9. Previously, we would
> have averaged all these positions together and shown an Average
> Position of 7. Going forward, we’ll only average the highest position
> your site appeared in for each search (3 for Nick’s search and 5 for
> Jane’s search), for an Average Position of 4.


Extra example - 
If I type laxmi temple in Google India, and I see your site in 1st position, and someone from US type same query and see your site in 3rd position, then [average position][2] will be (1+3)/2 = 2

Here not only GEO affect search position, but user devices, language(US, UK, IN English) also affect search position, hence Google display it as average position.

Also the ranking data displayed in search analytic report is not real time, Google might show you one week older data, so the current average position might not 100% accurate.


  [1]: https://webmasters.googleblog.com/2012/01/update-to-top-search-queries-data.html
  [2]: https://support.google.com/webmasters/answer/7042828?hl=en