Disclaimer: This information is accurate and true to the best of my knowledge. Content is for informational or entertainment purposes only and does not substitute for personal counsel or professional advice in business, financial, legal, or technical matters.
Finally, the national average price of gasoline has dropped.
"The national average for a gallon of regular gas is nearing the $4 mark and, as of Wednesday, is already at or below that price in 20 states, according to data from the automotive club AAA. The country-wide average is currently $4.16, a drop of 65 cents from a month ago." —Adam Hardy
Currently, Texas has the lowest fuel prices in the country.
"Texas currently enjoys the nation’s lowest average gas prices at $3.66 per gallon. Gas prices are the highest in California, as per usual, at $5.56, and all states have seen steady declines in recent weeks." —Adam Hardy
But why are gas prices falling, even though they are still historically high?
President Biden has take some (rather controversial) steps to attempt to reduce gas prices: Climate change is an urgent issue and air pollution is increasingly a major concern.
"President Biden has taken steps to try to tame gas prices, including the release of 1 million barrels of oil per day from U.S. stockpiles as well as keeping E85 gasoline, a cheaper blend of gas that includes higher levels of ethanol, on the market until September 15. (E85 is typically restricted during the summer months because of air pollution concerns.)" —Adam Hardy
Nonetheless, other factors have contributed to the decrease in prices at the pump, including seasonal shifts in demand and the lower cost of crude oil.
"Plummeting crude oil prices are also a major factor. According to the U.S. Energy Information Administration, the price of oil makes up about 55% of the price consumers pay at the pump. Following Russia’s invasion of Ukraine, the price per gallon of oil on the West Texas Intermediate, the benchmark exchange for U.S. oil, hit a 2022 high of $123.70 in early March. When gas prices peaked in mid-June, they followed another major spike in oil prices just days prior. Since then, oil prices have crashed, and gas prices have followed suit." —Adam Hardy
Although there are no guarantees, gas prices are expected to fall further if crude oil prices remain steady.
"If oil prices hold steady — or continue to drop — the price for a gallon of gas is expected to soon fall below $4 nationwide." —Adam Hardy
According to Patrick De Haan, more than 81,000 gas stations across the country are selling fuel at $3.99 or less. He estimates that the national average will reach that point in approximately one week.
"More than 81,000 stations are selling gas at $3.99 or less, and he estimates that the national average will reach that point in about a week." —Patrick De Haan
Prices could potentially drop even more this fall due to seasonal shifts in demand.
"As normal seasonal factors kick in, as De Haan highlighted, prices could go even lower in the fall." —Adam Hardy
Nonetheless, the fall in prices is hard to predict, because a lot of consumers modified their driving habits to cope with the exorbitant prices: Now that parents are shuffling their kids back and forth to school and costs have lowered—for the time being—demand could potentially increase, lowering the rate of decline.
"...AAA data suggests that we might not be able to rely on the seasonal dip in prices in the coming weeks because Americans made significant changes to their driving habits during the summer to cope with record-high gas prices. Now that gas prices are falling, Americans might return to their normal driving habits thus increasing demand. AAA says that could slow the rate of decline, but that doesn't necessarily mean gas prices will rise." —Adam Hardy
In short, consumers can be cautiously optimistic that gas prices might drop, but the market is still very volatile.
"Before the war between Russia and Ukraine, the Energy Information Administration projected gas prices would fall well below $3 per gallon this year. Obviously, that forecast did not factor in the war and the ensuing tumult to oil markets. Should oil markets and supply begin to stabilize, though, gas prices may start heading in that direction again. Likewise, a recession could also keep the price of oil down." —Adam Hardy