Nashville gas prices tick down, but remain higher than last year
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Pain at the pump is easing a bit in Nashville and beyond, but gas remains far more expensive heading into the summer than last year.
Why it matters: High gas prices are the most visible economic effect of the Iran war for many Americans grappling with inflation.
Driving the news: The average price per gallon in Nashville fell to $4 on Monday, per GasBuddy — down 15 cents over the last month.
- Nationwide prices ticked down as well as U.S. and Iran continued discussing a possible deal to extend the ceasefire.
Yes, but: It's a far cry above the $2.62 price in Nashville on Feb. 1, before the war started. Analysts see prices remaining above pre-war levels through the summer travel season and beyond.
- And GasBuddy predicts another spike could be days away.
Stunning stat: A recent AAA survey found that when pump prices rise, 44% of Tennesseans let their gas tank fall closer to empty than usual before filling up.
- "Repeatedly driving on a very low fuel level can damage [a car's] fuel pump, potentially leading to repair costs of $1,000 or more," AAA spokesperson Megan Cooper said in a statement.
- "AAA recommends refilling your gas tank before it drops below a quarter full."
Reality check: Don't expect a quick return to pre-war prices or anything close for the foreseeable future.
- Even if a U.S.-Iran deal becomes official, it's not clear whether tanker owners will feel confident enough to travel through the Strait of Hormuz in large numbers anytime soon.
- Even if they do, the global market will remain tight for a long time. The situation is getting even more dire as countries' stockpiles are drawn down.
Once the strait is cleared, "a minimum of two to three months will likely be required to re‑establish steady export operations," the International Energy Agency said in its mid-May oil market report.
- Plus, Persian Gulf countries that cut production when the main export route closed will need to revive it — and it's not like flipping a switch.
Between the lines: Other structural forces will act as a check on how much pump prices fall. One is that U.S. fuel demand is higher during the summer.