The high cost of gas throughout the United States may soon decline after gasoline futures plunged more than 10% on Tuesday and are down over 22% since June.
On Tuesday, the price of international benchmark Brent crude plunged by almost 10%, while the cost of US crude oil dropped by more than 8%.
According to Patrick De Haan, chief petroleum analyst at gas price monitoring site GasBuddy, "We're on the cusp of seeing more savings."
He also expressed optimism that the relief "could make its entire way to the pump in the weeks ahead."
The American Automobile Association (AAA) reports that the current national average price for a gallon of gasoline is $4.78, down from a previous high of almost $5 per gallon. Only $3.13 was the national average one year earlier, a 50% annual increase in petrol prices.
The Biden administration may also benefit politically from Gas Prices Going Down given that, although presidents have little influence over gas prices, they still come under fire from both supporters and opponents in politics.
Wednesday afternoon saw the price of US crude oil average at $98 per barrel, down from around $108 late last week. Brent crude decreased to about $101 today from about $111 a week ago.
Earlier Wednesday, Brent prices briefly dipped below $100, the first time since April prices have been under $100 for the commodity, according to a report published by WDVM.
Expect Decline in Fuel Prices in the Weeks Ahead
De Haan said he thinks consumers could see another decline in the coming weeks ranging from an additional 40 cents to an additional 65 cents if the situation otherwise remains the same.
He predicted that the average price per gallon might drop 40 to 65 cents in the next three to six weeks.
According to experts, the dip has pros and cons because the price reduction isn't the result of any actual changes in supply but instead is the result of customers cutting back on their expenses and lowering expectations of demand.
In a report from The Hill, Phil Flynn, an energy markets analyst with the PRICE Futures Group. expects consumers to see the gas price in the US dropping in the coming days.
He explained: "We're starting to see from the consumers, instead of paying $5 a gallon, they're paying $4.80 a gallon - and isn't that wonderful - but it's also because they don't have as much money in their pockets, and they're not going out to dinner and to eat, so what we're seeing is a pullback in demand. And that's because people are feeling the pain of higher prices."
Despite the Decline, Oil Prices Remain Relatively High
The initial hints of a slowdown come after a time when pump petrol prices momentarily hit a record high of $5 per gallon, per Bloomberg. According to AAA data issued on Tuesday, even with the most recent decline, they remained at $4.80 per gallon, which is a very high level historically.
Pres. Biden tweeted over the long weekend that firms managing gas stations have to reduce pricing. Jeff Bezos, the founder of Amazon.com Inc., criticized the President's statement.
The AAA said a record number of cars were anticipated to hit the roads over the Fourth of July weekend, yet gas prices are still significantly higher than they were a year ago.
