As of early this morning, the national average price of a gallon of regular gas has dropped under the psychological barrier of $4 at $3.990, the latest data the American Automobile Association (AAA) posted shows.
After hitting the record of $5.016 on June 14, this is the first time since early March the gas prices have retreated to below $4/gallon in huge relief for consumers but also for Democrats as Republicans are hammering rising prices in midterm campaigns.
Over the past month, retail gas prices have fallen almost nationwide with the Midwest and South seeing some of the steepest drops – Ohio had the largest fall ($1.36) – while Hawaii had the smallest fall (21¢).
However, even the steadily falling gas prices during the peak of the summer driving season didn’t lure the drivers that struggle to cope with higher pump prices to fuel in another sign that, at least for now, Americans are changing their driving habits.
AAA spokesperson Andrew Gross pointed out that it’s possible that the national average will fall more below $4 since the cost of oil has also edged lower on fears of economic slowdowns around the globe and oil is the primary ingredient in gasoline.
The president of Lipow Oil Associates, Andrew Lipow, also expects an additional decline of about 5 cents per gallon in the coming weeks, and further drop of about 15% after mid-September.
In a signal that the worst of the recently elevated energy costs might have passed, both crude oil and wholesale gasoline prices have rolled over since June.
After the Russian invasion of Ukraine pushed the global benchmark Brent crude to a record $139 per barrel, it reached $92 early on Wednesday but quickly rebounded from losses from slightly increased US gasoline demand and as a lower-than-expected U.S. inflation figure drove investors into riskier assets.
Driven lower by a sharp fall in energy costs, inflation was flat in July, prompting analysts to also decrease inflation expectations although consumer inflation is still up 8.5% over the past year.
While the headline inflation was dragged down 7.7% in July due to gasoline prices fall, but due to the continued rise in rents, a major factor in stubbornly high underlying inflation, renters faced a 0.7% rise in costs.