Gas prices could fall below $4 a gallon by October if oil stays at current levels, an analyst has said.
The recent downward trend in gasoline prices is just beginning. However, “if the oil market remains at these levels, we could see the national retail gasoline price dip below $4 a gallon by the end of October,” wrote Andy Lipow of Lipow Oil Associates in an article. note Wednesday.
“It’s a long time away and in the meantime we have a hurricane season and we haven’t yet seen the impact of the European Union’s phased ban on Russian oil purchases. But there are reasons to be optimistic,” he added.
A gas specialist predicted the national average could fall below $4 a gallon before the end of the summer.
“We are seeing steep declines in many parts of the country and that should continue,” Patrick De Haan, head of oil analysis at GasBuddy, told Yahoo Finance Live recently.
The latest data from the Energy Information Administration showed a 5% year-over-year decline in gasoline demand over the past four weeks.
“I expect this trend to continue as the consumer grapples with high prices. A 5% drop in gas mileage is a significant amount – that’s about 400,000 barrels per day. I think we keep in mind that a good number of people are now working from home compared to the pre-2019 pandemic and that’s a permanent destruction of demand,” Lipow added.
The national gasoline average in the United States has fallen over the past month to $4.47 per gallon as of July 20. according to AAA.
Oil prices have fallen significantly over the past few weeks on fears of slowing demand and a strong dollar. On Wednesday, West Texas Intermediate (CL=F) crude futures for August delivery settled down 1.88% to $102.26. Brent futures (BZ=F) closed at $106.92.
Ines is a stock market reporter for Yahoo Finance. Follow her on Twitter at @ines_ferre
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