Gas prices, which have surged this summer amid the war in Ukraine, fell Tuesday to below $4.50 a gallon for the first time in two months. Gas prices have dropped for 35 consecutive days and are down more than 10% since hitting a record in June.
The national average price for a gallon of gasoline stands at $4.495, according to data released by the American Automobile Association. In some parts of the U.S., gas prices are below $4.
OPIS, which surveys gas stations to compute price averages for AAA, reported that about 24,000 gas stations are posting prices below $4 across the Southeast, as well as Texas and Oklahoma. The most common price that was recorded by OPIS on Monday was $3.99.
Gas prices have been one of the main drivers of rising inflation, which has sparked concerns about a looming recession.
The Consumer Price Index report in June showed that inflation grew by 9.1% in the last year. Higher gas prices were a primary factor, with the gas index climbing 11.2% in June, up 4.1% in the last month. On a yearly basis, energy prices rose 41.6% with the gas index showing 59.9% on its own.
Widespread inflation, exacerbated by the disruptions to supply chains created by the pandemic and worsened by Russia’s war in Ukraine, have driven up food and commodity prices worldwide. Polls show that 18% of Americans have said that inflation is the country’s biggest problem.
Market expectation for inflation over the next 12 months (June to June) are now at 2.2%. Given that gasoline prices are likely to be lower in June 2023 than they were in June 2022 (deflation!) this isn't obviously crazy. The 1.8% pricing a week ago did seem obviously crazy. pic.twitter.com/ELyOh1sEjZ
— Jason Furman (@jasonfurman) July 19, 2022