Gas prices dip below $5 a gallon in first weekly drop since April

U.S. motorists are receiving a slight relief, with gasoline prices recording their first weekly drop in more than two months amid falling oil prices and falling consumer demand.

“Oil has really fallen today – the market is so driven by headlines,” Andrew Gross, a spokesman for the AAA car club, which tracks fuel costs, said Friday. “There is a lot of concern about global recessions, which will cause a major slowdown.”

The national average of a gallon of normal unleaded gas fell to $ 4.98 on Monday, below the $ 5 pair on Friday, three days after reaching an all-time high of nearly $ 5.02, according to AAA, which updates the figure daily.

A drop in crude oil prices, along with the first weekly drop in demand after three weekly hikes, should offer at least a short-term respite from record gas prices, Gross told CBS MoneyWatch.

According to Patrick De Haan, an analyst at GasBuddy, the national average is down nearly five cents a gallon from a week ago and stands at $ 4.97, and gasoline prices have experienced their first weekly drop in nine weeks.

“Depending on the markets right now, they can change and they do, the national average could drop from $ 4.55 to $ 4.75 a gallon in the coming weeks unless trends change,” De Haan said. he tweeted Friday.

The White House has few levers to throw

People tend to wrongly attribute the cost of gas to the president of the United States, when in fact there is a limit to what the White House can do to lower fuel prices, said Gross, who noted that about 60 percent of the price at the pump is dictated by the cost of crude oil. “The local gas station sets its price, and there are all sorts of factors, including the location and how many people work there.”

U.S. Secretary of Energy Jennifer Granholm said earlier this week that the Biden administration is working to ease the economy. pain caused by high gas pricesincluding the release of 1 million barrels per day of the Strategic oil reserve. Still, “there is no quick fix,” he added.

Another potential move by the White House could help boost U.S. production, but would not bring immediate relief, analysts said.

“We expect the administration to be able to activate the Defense Production Act to expand the refinery’s capacity, but any impact on the market / consumer of these efforts will be a long-term consideration,” analysts said. by Raymond James Equity Research Ed Mills and Chris Meekins in a report. .