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Gas prices fell below $4 for the first time in months

London (CNN Business)US drivers can breathe a sigh of relief — average petrol prices drop It's been below $4 a gallon for the first time since March.

The national average price of regular gasoline fell to $3.99 a gallon on Thursday, according to AAA.

Gasoline prices hit a record high of $5.02 in June, and drivers filled up their tanks for the summer travel season. Stocks were also boosted by soaring global oil prices as Western countries turned their backs on Russian oil following Russia's invasion of Ukraine.

However, prices have since fallen 21% as drivers cut spending and fears of a recession threaten to weigh on demand. Despite the decline, it remains 25% higher than this time last year.

"The market panicked at the beginning of the summer. Inventories were very tight," said Patrick De Haan, head of oil analysis at GasBuddy. "But the market was overheated. It was overbought," said De Haan. He said it could continue to fall. But he noted that oil prices are starting to recover from recent lows and that a hurricane season could disrupt energy supplies.

Director of the White House's National Economic Council Brian Dees said going below $4 is a significant development for Americans and means that the typical household would spend $100 less on fuel for two cars.

"This is a meaningful savings that people feel in their lives," Deese said in his CNN telephone interview.

Diess added that the White House tracks gas prices and energy supplies "very closely" and prices should continue to fall.

"Today's market pricing suggests pump prices will come down a bit more," he said.

AAA said in a press release on Monday that "few drivers refueled last week despite petrol prices steadily falling during the peak summer driving season."

"For now, another sign that Americans are changing their driving habits to cope with rising pump prices."

Analysts said: An unprecedented emergency oil release by the United States has also helped push oil and gasoline prices down, he said. In late March,the White House announced that he would release one million barrels per day from the Strategic Oil Reserve for six months.

US oil prices plummeted from a peak above $120 a barrel in June to around $92 a barrel on Thursday, aided by an easing of the global supply crisis.

In a report released on Thursday, the International Energy Agency upgraded its global oil supply outlook. This is partly because Russia continues to produce more oil than expected.

"Russian exports of crude oil and petroleum products to Europe, the United States, Japan and South Korea have fallen by almost 2.2 million barrels per day since the start of the war, while flows to India, China Upstream losses are easing, along with seasonally rising Russian domestic demand, such as in Türkiye, Türkiye.

By July, Russian oil production was at pre-war levels.

180 million barrels of oil from the US Strategic Oil Reserve} also helped boost supply

Matt Egan contributed reporting