U.S. gas prices fell below $4 per gallon on average on Thursday, marking the first time since March that prices have reached this level. According to the American Automobile Association (AAA), the average price is now $3.999 per gallon. This decrease follows a 15% decline in the price of U.S. crude oil this month. However, prices vary significantly across the country, with California averaging $5.64 per gallon and South Carolina at $3.58 per gallon.
The drop in gas prices coincides with an agreement signed by President Donald Trump with Iran, which includes provisions for Tehran to dilute its stockpile of highly enriched uranium and waives certain U.S.-backed sanctions. The agreement aims for a permanent end to hostilities and initiates a 60-day period for negotiations regarding Iran's nuclear program. Despite the agreement, Trump has indicated that the option to resume military action remains.
As of Monday, oil prices for U.S. benchmark crude were approximately $80 per barrel, down from over $120 earlier in the conflict. However, analysts caution that it may take weeks or months for oil to flow through the Strait of Hormuz again, which previously carried a fifth of the world's crude oil. The disruption has affected not only crude oil supplies but also supply chains for various goods, leading to expectations of lingering higher costs for consumers.