Oil futures fell below $100 per barrel Tuesday due to fears that the slowdown in global economic growth could reduce the demand for crude oil. This was the lowest level in nearly two months. One expert stated that motorists could save up to 65 cents per gallons if this trend continues.
The benchmark U.S. crude oil price for August delivery dropped $8.93 to $99.50 a bar Tuesday on the New York Mercantile Exchange. This is its first drop below $100 since May 11. Brent crude oil for September delivery dropped $10.73 to $102.70 per barrel.
The sharp drop in oil prices on Tuesday follows a steady fall in U.S. gasoline prices since June's record highs. Regular gasoline is now selling at less than $5 per gallon at most U.S. stations. GasBuddy analyst Patrick De Haan tweeted Tuesday that if crude oil stays at this level, Americans could see a possible price drop at the pump of 40 to 65 cents per gallons in the coming weeks.
I don't like (jk), but I am upgrading this to a possible decline of 40-65 Cents per gallon in weeks ahead, should losses continue. https://t.co/6tCE34BrlE
This could be a relief to consumers who have been facing additional expenses of thousands of dollars this year because of the rise in gas prices.
On Tuesday, the national average price of a gallon gas was $4.80. This is an 8-cent decrease over the previous week. AAA attributes this decline to the fact that there were fewer people filling up in the past two weeks.
According to the motor club, the lull may not last for long.
"Domestic gasoline demand has slowed recently which helped to ease some of the pressure on pump prices. According to Andrew Gross, spokesperson for AAA Tuesday, about 80% of stations now sell regular gasoline for less than $5 per gallon. This trend of easing prices may be temporary as July is a month with the highest demand.
This report was contributed by The Associate Press
