NEW YORK (Reuters) – U.S. motorists should see gasoline prices fall below $3 a gallon for the first time in over three years as soon as next month, shortly before they go to vote in November’s presidential election, analysts said this week.
Softer gasoline prices, resulting largely from weaker fuel demand and sliding oil prices, are a relief for consumers who have struggled with record high fuel costs that have stoked inflation. Lower prices could also help Vice President Kamala Harris and other Democrats fight off sharp criticism from Republicans over pain at the pump.
As of Wednesday, the national average price for regular gasoline stood at $3.25 a gallon, down 19 cents from a month ago and 58 cents from a year ago, according to data from motorist association AAA.
The average should break below $3 a gallon by late October, if not sooner, with summer driving season over and retailers starting to sell cheaper winter-grade fuel in the weeks ahead, said Patrick De Haan, analyst at GasBuddy.com. In North Carolina, considered a swing state in the Nov. 5 presidential election, pump prices were already below $3 on Wednesday.
“Americans will definitely remember the price they see when they drive into polling stations, so this is definitely good news for Harris in her campaign for president against Republican Donald Trump,” De Haan said.
Studies by the Wells Fargo Investment Institute, among others, show U.S. presidential approval ratings are inversely tied to gasoline prices. Therefore falling prices should lift Democrats in this election cycle, said John LaForge, head of real asset strategy at the investment advisory firm.
Presidents actually have little direct influence on gasoline prices, which move based on global supply and demand fundamentals. Prices have dropped sharply this year because demand has been weaker-than-expected, especially in the U.S. and China. Global benchmark Brent crude has slid from over $90 a barrel in April to a near three-year low of under $70 on Tuesday.
A wild card is Hurricane Francine which was barreling through the U.S. offshore oil patch on Wednesday, lifting U.S. crude oil prices more than $2 a barrel on fears of lengthy production shutdowns.