Sugar, we’re going down

Average US gas prices dropped for the 23rd day in a row yesterday to reach $4.75 per gallon, representing the longest continuous downward streak since April 2020, per AAA data.

📉 Driving the drop… A decrease in oil prices amid concerns of an upcoming recession, combined with “demand destruction” – aka motorists buying less gas due to high prices.

• The price of gas is directly linked to the cost of crude oil, from which it's refined. Historically, every $10 increase in the cost of a barrel of crude adds roughly 25 cents to the price of a gallon at the pump.
• Prices reached an all-time high of $5.02 per gallon on June 14, and have declined ever since. Not so coincidentally (as we just learned), the price of crude fell below $100 per barrel three days ago for the first time since early May.

⛽️ The big picture: While prices at the pump are dropping, gas is still well above its $3.14/gallon average from one year ago, something the White House claims is almost entirely due to Russia’s invasion of Ukraine. In a letter to oil producers last month, President Biden attributed a price increase of $1.70/gallon to the war.

+Dig deeper: Biden admin considers federal gas tax holiday | What’s the deal with gas prices?