Aug 11, 2022 - Economy

Gas prices drop under $4 a gallon

Axios

Woodman's in Menomonie Falls, Wis., was ahead of the national curve, with gas just under $4 on July 20. Photo: Morry Gash/AP

Early this morning, AAA posted the national average price of a gallon of regular gas at $3.990, dropping under the psychological barrier of $4.

Why it matters: The falling gas price is a huge relief for consumers — and for Democrats, since Republicans plan to hammer rising prices in midterm campaigns.

It's the first time gas prices have retreated to below $4 a gallon since early March. They hit a record $5.016 on June 14.

The big picture: Both crude oil and wholesale gasoline prices have rolled over since June, signaling that the worst of the recently elevated energy costs may have passed, Axios' Matt Phillips writes.

The global benchmark Brent crude, which reached a high of $139 per barrel after the Russian invasion of Ukraine, was $92 on Wednesday.

Zoom in: Retail gas prices have fallen almost everywhere over the past month, with the Midwest and South seeing some of the steepest drops.

Ohio had the largest fall ($1.36). Hawaii had the smallest (21¢).

Zoom out: Inflation expectations are also falling. Inflation was flat in July, driven lower by a sharp fall in energy costs.

Reality check: Consumer inflation is still up 8.5% over the past year.

Add Axios on Google

Gas prices drop under $4 a gallon

What to read next