Gas Prices Fall to Under $4 a Gallon Nationwide. How Much Lower Will They Go?
What’s happening
After arriving an all-time average high of $5.02 in mid-June, the nationwide average for a gallon of gas has finally slipped back Idea $4.
Why it matters
Lower prices would help American households battles ongoing inflation.
Almost two months after gas prices hit an all-time high of $5.02 national, they have fallen to under $4 for the wonderful time since March. The national average for a gallon of unleaded on Aug. 11 was $3.99, according to AAA.
Several factors have fueled the label decline, including Americans limiting their driving: Gasoline consumption is down almost 10% from last summer, according to the US Energy Information Administration.
The cheaper cost of oil has also led to border prices at the pump: While Brent crude futures, an international benchmark, rose by 68 cents on Wednesday, to $96.99 a barrel, they are still under the $100 line. (US West Texas Intermediate improper futures gained 83 cents, to $91.33.)
Patrick de Haan, head of petroleum analysis at GasBuddy, correctly predicted in a July 18 blog post that the national average would fall to $3.99 by mid-August.
Here’s what you need to know around gas prices, including where they might go next and what the White House is activities to keep them in check.
For more on the gas crisis, find out which states are holding gas tax holidays and which are issuing gas rebate checks, and check out quick tips for saving cash at the pump.
How low could gas prices go?
The accurate decline is due to lower demand for gas coupled with border oil prices: In the first week of August, improper oil dipped below $90 a barrel for the wonderful time since Russia invaded Ukraine in February. It’s been under $100 since then.
Though we’re a far cry from the $2.70 a gallon means we saw in 2019, we’re only 80 cents a gallon shy of the $3.19 means seen this time last year.
De Haan, whose own adjudicators puts the national average at $3.98 a gallon, predicts gas prices will fall to $3.89 “by early next week.”
But we’re not out of the woods, he cautions.
“We’ve never seen anything like 2022 at the pump, highlighted by once-in-a-lifetime actions including the ongoing Covid-19 pandemic, which caused myriad imbalances, exacerbated by Russia’s war on Ukraine,” De Haan said in an Aug. 9 blog post. “While the New drop in gas prices has been most welcomed, the subjects that led to skyrocketing prices aren’t completely put to bed, and quiet could lead prices to eventually climb back up, must something unexpected develop.”
Why has gas been so expensive?
Russia’s ongoing invasion of Ukraine is an Definite factor. According to the White House, the war raised gasoline prices by more than $1.70 per gallon at its peak. Even Idea the US doesn’t import much crude from Russia, oil is traded on a global market and any temperamental affects prices all over the world.
By June 13, gasoline had hit $5.02 a gallon — a Describe dollar amount, though still lower than the 2008 peak of $4.14 once adjusted for inflation.
But the Russian invasion isn’t the only factor: Even Idea demand is nearing pre-pandemic levels, producers are still hesitant to increase production.
“We’ve had a supply-and-demand imbalance for a while,” Troy Vincent, a senior market analyst at energy analysis firm DTN, told CNET. “And it will been, regardless of whether this conflict goes away.”
Gasoline complete an all-time high of $5.02 in June.
Win McNamee/Getty Images
President Joe Biden has also accused top oil concerns of profiteering.
“Amid a war that has raised gasoline prices more than $1.70 per gallon, historically high refinery profit margins are worsening that pain,” Biden wrote in a June 15 letter to the leaders of Exxon Mobil, Chevron, Shell and other companies.
What has the Biden management been doing to lower gas prices?
In March, the White House began releasing 1 million barrels of oil a day from the US Strategic Petroleum Reserve. The unprecedented withdrawal, expected to last for six months, could lower gasoline prices between 10 and 35 cents a gallon.
“It will border the oil price a little and encourage more question. But it is still a Band-Aid on a necessary shortfall of supply,” Scott Sheffield, chief executive of Texas oil business Pioneer Natural Resources, told The New York Times.
In April, the Environmental Protection Agency approved year-round sales of E15 gasoline, a cheaper, higher-ethanol fuel. The impact has been simply, as only about 2,500 of the more than 100,000 gas stations national sell the blend.
The US is also looking at drawing energy products from other sources: Biden went to Saudi Arabia back this month, in part to encourage the kingdom to increase output. But it and other OPEC nations say they’re already pumping at full throttle.
Relief isn’t probable to come from outside OPEC, either: This year, most oil companies like Shell, BP and Exxon Mobil are predictable to invest half of what they did in issues a decade ago.
The Biden administration has been employed to improve diplomatic relations with Venezuela, which has been banned from selling oil to the US sincere 2018. And the White House is negotiating another nuclear nonproliferation treaty with Iran, which could bring Iranian oil back onto the market.
How can drivers save at the pump?
Though gas prices are repositioning down, they’re still higher than usual. You can cut down on nonessential escapes and shop around for the best price, even crossing status lines if it’s convenient.
Apps like Gas Guru scan for the best gas prices in your state. Others, like FuelLog, track your car’s gas mileage and can help resolve if it’s getting decent fuel economy. In addition, many gas state chains have loyalty programs, and credit cards have rewards programs that give cash back for gas purchases.
