U.S. gasoline prices could fall below $4 a gallon within days, according to two energy experts, though the national average was still above that mark on Thursday. GasBuddy put the average at $4.06 a gallon on Nov. 5, and Patrick De Haan forecast it would drop below $4 by the following week.
Tom Kloza, chief energy adviser for Gulf Oil, also expected the average to cross below $4, predicting it could happen within 10 days. The forecasts were reported by CBS News.
De Haan said lower oil prices and increased tanker traffic through the Strait of Hormuz were easing pressure on fuel costs. Brent crude fell below $100 a barrel on Thursday for the first time since September, trading at $97.44 by midday. U.S. benchmark West Texas Intermediate was at $90.42.
De Haan also linked recent oil-price declines to expectations surrounding the U.S. midterm elections. He said markets appeared optimistic that political pressure after the vote could prompt the Trump administration to pursue an agreement to end the war in Iran. That was his interpretation of the market movement, not a confirmed cause.
Seasonal factors are also contributing to lower pump prices, De Haan said. Demand typically eases as summer travel ends, and stations switch to winter-blend gasoline, which costs less to produce than summer-blend fuel.
Kloza said retailers’ current margin of about 75 cents per gallon was higher than usual. He described 40 cents as a more typical markup and said pump prices could continue to fall even if oil-market prices stayed near current levels.
The administration has also taken steps intended to ease fuel costs, including expanding access to tax-free red-dyed diesel, allowing Russian diesel imports and waiving the Jones Act, which sets requirements for shipping goods between U.S. ports.
De Haan also forecast that diesel could fall below $6 a gallon by Thanksgiving. Neither expert’s gasoline forecast means the national average had already dropped below $4 as of Thursday.
Reid Bentley