US Gasoline Price is Set to Fall

Reports about high gasoline prices and averages of $5 a gallon are already obsolete as gasoline costs are now declining, said Stephen Schork, creator of the Schork Report

Based on the Daily Fuel Gauge Report of the AAA, average gasoline prices all over the United States are about $3.82 per gallon. It is lower than its highest rate of about $3.95 in the early parts of this year. The fall was mainly due to the easing tensions between Iran and the West.

The West sanctioned Iran for their alleged nuclear weapons program despite Iran’s continuous denial of the charges. The sanctions restricted several countries from exporting Iranian crude.

In retaliation, Iran threatened to block the Strait of Hormuz, a waterway that connects the countries of the oil-rich Persian Gulf with all the other nations worldwide. Consequently, Brent current crude oil prices peaked to very high levels.

Brent crude, a European blend of oil, mostly determines the movement of gasoline prices all over the world.

Despite the threats of Iran, it has agreed to talk with Europe, the United States and several countries, that is why Brent crude prices dropped.  Schork predicts that gasoline prices in the United States will continue to fall.

In his statement to CNNMoney, Schork said that gasoline prices are expected to move lower. He added that for as long as there are no issues in supply or outages in the refineries, gasoline prices have already reached their highest level for the summer.

The White House has not disregarded the possibility of using the Strategic Petroleum Reserve, the country’s crude supply intended to be utilized for emergency purposes, despite the drop in current crude oil prices because officials still consider it as very high.

Daniel Poneman, the Deputy Energy Secretary, said that they are very focused on the prices of energy because they are too high. Moreover, he said that the Administration is holding onto every available tool, and they are discussing it with their international partners.

By: Chris Termeer

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