According to GasBuddy, the average national gas price dropped by about 9 cents to $4.88 per gallon in just one week.
However, it's unlikely that the minor price retracement will indicate a longer-term trend.
"The way that decline potentially continues is if we see a drop off in demand," Rebecca Babin, a senior energy trader at CIBC, said during Yahoo Finance Live. "I would note that the prices at the pump have come off by maybe 2% to 3% whereas the prices of commodities have come off 10% to 15% [off their highs]. So it hasn't been an equal relationship there. Unfortunately, I don't think we are going to see this gap lowering prices at the pump because demand has remained pretty resilient and we have China starting to reopen," she added.
"Can we dip a little bit? Sure. Is it going to be enough to kind of get us back to $4.50 a gallon? I don't think so," she concluded.
By the Fourth of July, GasBuddy predicts a 10 to 20-cent decrease in U.S. gas prices. Americans should brace themselves for additional discomfort at the pump after that, though.
"It's been a scorching summer at the pump with record prices set in every state. While we may see brief relief here and there, the high prices don't seem to be holding many Americans back from hitting the road with the economy fully reopen[ed]," Patrick De Haan, head of petroleum analysis at GasBuddy, said in a press release.
"While we may see relief as we approach July 4, and potentially after, the volatility in markets remains high. We still could see a super spike in gas prices later this summer, should a hurricane threaten Gulf Coast oil refineries or oil platforms. Motorists should know that while we may see small relief today, risks remain that prices could go up at a moment's notice and set new records again," he continued.
President Joe Biden has indicated that he is close to making a decision regarding a temporary suspension of the federal 18.3 cents per gallon fuel tax, which could provide some relief to American drivers.
"If the tax is suspended, prices at the pump could drop even further this summer, saving American drivers collectively about $70 million per day while the average motorist saves $25-$70 over three months," GasBuddy noted.
However, according to the New York Times, some analysts argue that since the federal gas tax accounts for less than 5% of the overall cost at the pump, many customers might not even notice the change.
