US Gasoline Prices Drop Below $4 Per Gallon for First Time Since April

For the first time since mid-April, the average retail price of gasoline in the United States has declined below $4 per gallon, fueled by growing optimism that a preliminary agreement with Iran will lead to the reopening of the Strait of Hormuz.

On Monday, US President Donald Trump announced that the United States and Iran had signed a memorandum of understanding to end a conflict that began approximately four months ago. However, it remains uncertain whether this agreement will hold.

The drop in fuel prices could provide some relief for the Trump administration, which had pledged to reduce energy costs for consumers. Trump and Republican lawmakers, who are defending their slim majorities in both the House and Senate ahead of the November midterm elections, have faced negative reactions due to rising fuel expenses.

The $4 per gallon mark is widely regarded as a psychological threshold, with some consumers beginning to alter their behavior, such as cutting back on fuel usage, once prices reach this level.

Data from the GasBuddy platform showed that the national average retail gasoline price fell to $3.997 per gallon on Sunday, then dropped below $4 again on Monday, marking the first time since mid-April. Despite this decrease, prices remain 90.8 cents higher than the same period last year.

Meanwhile, US strategic crude oil reserves have fallen to their lowest point in over 40 years, according to a Department of Energy document reviewed by Agence France-Presse on Monday. This decline comes amid ongoing supply disruptions.

The American Automobile Association reported that the national average gasoline price was $4.065 per gallon on Monday.

Gasoline prices surpassed $4 per gallon in late March after Iran blocked the passage of most shipments through the Strait of Hormuz, a critical route that handles nearly one-fifth of global oil flows.