Gas prices have retreated from their $5 record high, and the relief at the pump could continue as the economy cools off and supply catches up with demand. Decreasing oil prices along with an increase in domestic gasoline stock have caused the national average to drop in consecutive weeks, according to the AAA.
“Domestic gasoline demand dipped recently, which took some of the pressure off of pump prices," AAA spokesperson Andrew Gross said in a statement. "About 80% of stations are now selling regular for under $5 a gallon.”
The national average gas price reached a record high of $5.02 for the week ending June 13, according to data from the U.S. Energy Information Administration. It has dropped in consecutive weeks after skyrocketing from a 2022 low of $3.28 at the start of the year. The EIA lists the average price at the pump at $4.82 last week (the last available week of data), whereas the AAA says the national average sits at $4.80. The drop is about $.10 from the preceding week, but still $1.78 higher for a gallon of gas than a year ago.
Drivers filling up in Texas, Delaware, Arizona, Illinois, Indiana, and Ohio have seen at least $.12 declines in the price of a gallon of unleaded gas not exceeding 88 octane.
The price of crude oil increased last week due to forecasts of increased summer driving for Americans, but futures for wholesale gas have retreated on concerns of stalled economic growth due to rising interest rates and inflation. In short, summer gas prices can vary wildly based on demand.
Axios reported that Neil Dutta, head of economics at Renaissance Macro, expects gas prices to drop "about 30 cents per gallon in the weeks ahead."
AAA was less sanguine. "July is typically the heaviest month for demand as more Americans hit the road, so this trend of easing prices could be short-lived,” Gross said.