At a $2.76 a gallon national average, gas prices are at their cheapest in six months, dating to the end of April.
On the week, motorists in every state but Hawaii are paying as much as a nickel less to fill-up. Today’s national average is six cents less than a week ago,15-cents less than a month ago but 24-cents more than a year ago. As demand continues to drop, gas prices could get even cheaper.
This price drop is happening at a time that analysts previously thought would likely see pump price increases due to the White House’s re-imposition of sanctions on Iran, some of which will target the country’s energy sector and impedes its ability to export oil. However, in May, when the decision was announced (to take effect in November), the market reacted quickly with crude oil prices (WTI) spiking as high as $77/bbl this summer. At the same time, Iran’s exports began to dip. Today, they are reported to be about one million b/d less than in May while crude oil prices have stayed below $70/bbl for two weeks.
“With the market anticipating and reacting to the pending Iran sanctions throughout the summer, motorists likely have seen the worst in terms of retail prices for the year,” said Tammy Arnette, spokesperson for AAA. “If the crude oil market remains steady, gas prices are likely to continue to fall as much as ten cents in the near-term.”
That being said, should any factors cause an upward shift in crude oil prices, the cheaper gas prices would likely be a temporary trend.
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