Gasoline prices fell to their lowest level in more than five months. Good news for consumers struggling with high prices for many other essentials.
His national average for a regular liter on Thursday was $1.05, down from his mid-June record of $1.37, according to AAA. Still, it's about 21 cents higher than the average a year ago.
Energy is a key determinant of the cost of many goods and services, and while lower prices for gasoline, airline tickets and clothing have given consumers some relief, inflation has Rates are still near 40-year highs.
While waiting between gas stations at a gas station in Kenner, Louisiana, hired driver Glenn Smith raised his price to $1.01 per liter.
"I'm not pink tickled, but I'm glad I'm smaller than I used to be," said Smith. “For a while, I had $50 in gas every two days in my car. It was $12 from the airport to the city, and $12 each way.” Crude oil prices started to rise in mid-2020 as they recovered from the 2019 shock. They rose again when the US and its allies announced sanctions on Russian oil over their war with Ukraine.
Recently, however, oil prices have fallen on concerns about slowing economic growth around the world. US benchmark crude dropped from above $120 a barrel in June to close to $90 a barrel recently.
It is unclear whether gasoline prices have risen enough to discourage consumers from driving. Some experts believe it to be true, but admit that the evidence is mostly anecdotal. I don't know if it was the amount, I think it was a short-term increase," said an economics professor at the University of North Carolina at Charlotte. ``People started looking at what they were driving.''
Schwarz said oil prices were at least 10% higher, especially as OPEC and partners, including Russia, agreed to limit oil production to a modest increase in September. We expect it to remain relatively stable over the next month or so and will likely not be enough to push prices lower.
Christian Vom Lane, an economics professor at Brigham Young University, says oil prices are a key driver of gasoline, but seasonal trends will prevent prices from skyrocketing again.
"We are nearing the end of summer and summer is the peak travel season, so demand will naturally decline," he said. I was. "It has certainly contributed to the recent decline in gas prices."
The average gas price fell for 58 days in a row, a streak that will soon end, according to the Oil Price Information Service. Tom Kloza, head of energy analysis, predicted. He said the industry will face challenges to meet gasoline demand for the rest of the year. It has closed some of the largest U.S. refineries in easy-to-reach areas. The Gulf of Mexico is dotted with oil production platforms. Also, he said, "refinery operating rates will drop due to a lot of delayed maintenance that cannot be postponed indefinitely." likely to be a major issue heading into the midterm elections.
Republicans condemn President Joe Biden for soaring gasoline prices, revoking major pipeline permits and suspending new oil and gas leases on state land. used the decision.
Biden has previously targeted oil companies, accusing them of making huge profits while not producing as much energy as possible. "Exxon has made more profit than God this year," he said in June.
Exxon said oil production had increased. His CEO of Chevron said Biden was trying to smear his industry.
Biden also ordered the release of oil from the nation's strategic oil reserves this year. While not large enough to explain the drop in gasoline prices, analysts say extra supply from reserves may have helped keep pump prices down.
The national average for gas has not fallen below $1.05 per liter since early March. The price he reached $1.32 per liter on June 14, according to AAA. They declined slowly over the rest of June and then began to decline more rapidly, with shopping app GasBuddy reporting that the national average fell below $1.05 a liter on Tuesday.
Motorists in California and Hawaii still pay more than $1.32 per liter, and similar amounts in other western states. The cheapest gas is in Texas and several other states in the South and Midwest.
A year ago, the national average price was just under 84 cents per liter, according to AAA. After a long rally, its price has fallen steadily this summer, dropping 4 cents per liter over the past week and 18 cents last month.
"When you talk to non-economists, gas prices always go up faster than they go down," said Schwartz, an energy price expert. "These are still high gas prices."