Why prices could soon fall below $4 a gallon as fuel costs keep falling

Prices head lower

Energy experts say U.S. motorists could soon pay less than $4 per gallon for gasoline. That would be the first time prices have fallen below that level since July.

Gasoline and diesel prices have both decreased in recent weeks. Kloza, Gulf Oil’s chief energy adviser, expects the national average for gasoline to fall under $4 within 10 days.

Markets watch Iran conflict

De Haan said the decline largely reflected market expectations about the U.S. midterm elections. Investors anticipated the results would show public dissatisfaction with the war in Iran and add pressure on the Trump administration to reach a deal to end it.

Crude oil benchmarks also moved down. Brent crude fell below $100 on Thursday for the first time since September and traded at $97.44 by midday; U.S. benchmark West Texas Intermediate stood at $90.42 a barrel.

Government measures and margins

The Trump administration has taken several steps intended to ease gasoline prices. They include widening access to tax-free red-dyed diesel and allowing Russian diesel imports. The administration also waived the Jones Act, which requires goods moving between U.S. ports to travel on ships built, flagged and crewed in the United States. Meanwhile, gas stations are earning about 75 cents per gallon sold, a larger margin than usual.