A gallon of gasoline averaged approximately $4.47 across the country on Wednesday, a steady decline from the record high of $5.02 reached on June 14. According to White House energy advisor Amos Hochstein, this easing at the pump could last towards $4 per gallon.
We already have several gas stations throughout the nation priced below four dollars, Hochstein declared on Sunday during CBS News’ Face the Nation. This is the highest rate of decline we’ve witnessed against a significant rise in oil prices during wartime in Europe, where one of the sides fighting the conflict is the third largest oil producer in the world.
In the absence of hurricanes, outages, or other unavoidable disturbances, the average could drop to $3.99 in mid-August. In a blog post from last week, Patrick De Haan, petroleum analyst at GasBuddy, predicted.
We’ve already witnessed the average national decrease for 34 consecutive days. We’ve seen more than 255,000 stations back with $3.99 for a gallon or lower. According to De Haan, thousands of stations are expected to join the ranks this week. It’s excellent news for motorists. However, it’s still much higher than the $3.16 average that motorists paid last year.
Here’s what you should know about the cost of gasoline, where they could take them next, and precisely what the White House is doing to keep them under control.
For more information on the gas shortage, learn about the states that are having the gas tax holiday that is giving out gas rebate checks, as well as quick strategies to save cash at the pump.
What is the reason why gas is so expensive?
The ongoing assault on Ukraine has been the most obvious reason. In the words of the White House, the war has pushed up the price of gasoline by over $1.70 per gallon at the maximum. However, the US does not import as much oil from Russia; the oil trades globally, and prices change globally.
However, the Russian attack isn’t the only reason. Even though production is at levels close to pre-pandemic, the producers are hesitant to boost output.
We’ve been experiencing a supply and demand imbalance for some time, Troy Vincent, a senior market analyst at the energy analyst business DTN, said to me. It will continue to be regardless of whether the issue is resolved.
Vice President Joe Biden has also accused significant oil companies of making money.
Amid a war that has raised the price of gasoline to more than $1.70 per gallon and historically high-profit margins are increasing that suffering, Biden wrote in a June 15 letter to executives of Exxon Mobil, Chevron, Shell, and other companies.
How much will gas costs this summer?
Market volatility has made predicting prices for gas an arduous task. This month, Natasha Kaneva, J.P. Morgan’s director of research on commodities, forecast that the gas cost could increase to $6.20 per gallon by the end of August.
On June 13, the price of gasoline was at $5.02 per gallon — the highest amount in a dollar but still less than the 2008 high of $4.14 adjusted to inflation. However, crossing the $6 threshold or even the limit of $5 is not as likely the present.
If oil prices fall below $100 and remains there, it could be possible to witness gas prices rising closer to $4, AAA Northeast’s Mark Schieldrop told the Boston Herald. If everything goes as it’s been going, the trend should eventually go toward $4 by the end of July, Schieldrop added, and hope we can break the $4 threshold and move back into the $3,000 range.
DeHaan believes that several states will drop back to the average of $4 within the next few days. Most of them are in the south, but who could extend it to other states in the coming weeks.
The previous Wednesday, South Carolina, Georgia, and Texas were all just shy of the $4 threshold.
How is this Biden administration doing to cut the cost of gas?
On June 1, Biden supported a 3-month nationwide holiday for gas taxes. In total, half-a-dozen States have already lifted gas taxes for their state.
In an open note, Biden also called on top oil companies to cooperate with the administration to tackle reductions in production and pricing, inventory, and refining capacity problems.
He has previously criticized the company for having over 12 million acres of federal property approved for drilling and 9,000 production permits. He has suggested that the oil industry be required to pay penalties to ensure leases expire in a state of non-use.
In March, The White House began releasing a million barrels of crude oil each daily from the US Strategic Petroleum Reserve. The unprecedented release, which is expected to run for six months, may reduce the cost of gasoline between 10 to 35 cents per gallon.
It could reduce the price of oil somewhat and help increase demand. However, it’s still an emergency measure to address a massive shortage of supplies, Scott Sheffield, chief executive of Texas oil company Pioneer Natural Resources, stated to The New York Times.
In April, the Environmental Protection Agency approved the sale of year-round E15 gasoline, a less expensive and higher-ethanol fuel. The effect will be minimal because only 250 of the 100,000 gas stations across the country offer the mix.
It’s also possible that the US is also considering purchasing energy products from another source: Biden will be in Saudi Arabia this week to encourage the country to boost its output. However, it and the other OPEC countries say they’re already operating at full speed.
It’s unlikely to be a result of outside OPEC as well: this year, oil giants such as Shell, BP, and Exxon Mobil are scheduled to invest the equivalent of half of the amount they spent in production just a decade ago.
It is believed that the Biden Administration has been trying to enhance relationships with Venezuela that we have barred from 2018. The White House is negotiating another nuclear nonproliferation agreement with Iran that could allow Iranian oil back on the market.
How can drivers save money at the pump?
It is possible to cut down on unnecessary trips and shop around to get the best deal, even crossing states if it’s feasible.
Apps such as gas guru search for the most affordable gas prices in your area. Other apps, such as fuelling, monitor the mileage of your car and help you determine if your vehicle is getting adequate efficiency. Additionally, numerous gas stations offer loyalty programs, along with credit cards come with rewards programs that provide cash back on gas purchases.