Expect Gas Prices To Decelerate From Record Highs Soon — Here’s Why
Gas prices are finally expected to cool down. Money reported that gas prices have fallen for the third consecutive week, with the average gas price at about $3.38 per gallon — down 2 cents from last month. Prices may also drop even further as crude oil dropped to $10 per barrel Nov. 26 following the news of the new Omicron variant.
“Gas price declines are slowly picking up momentum. With oil’s recent fall and the jury out on a new Covid variant, Omicron, we could be in store for lower prices based on many countries turning back to travel restrictions, limiting oil demand and potentially accelerating the drop in gas prices,” Patrick De Haan, GasBuddy’s head of petroleum analysis, said in a statement.
The Biden administration took steps to bring down gas prices by releasing 50 million barrels from America’s strategic reserve.
David M. Turk, Deputy Secretary at the U.S. Secretary of Energy, told NPR that the 50 million barrels are one tool being used to help balance the global supply and demand of oil.
“What we have is what oil analysts call a backwardated market, where the price is high right now, but supply is expected to catch up to demand. And prices are expected to decrease as we get into 2022,” Turk explained. “So this exchange mechanism that we’re using right now allows us to put more oil into the market right now when prices are very high, reducing the prices at the pump.”
However, Money noted that experts are attributing price drops to the Omicron variant and not the president’s recent actions. Oil prices jumped 2% following Biden’s announcement, but dropped by more than 10% after news of the Omicron variant was released.
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