Price At The Pump: Hope Is Pushing Oil Prices Lower

Oil prices traded lower to start the week, down by roughly 4%-5% in Monday’s action. And that movement continued into early Tuesday trade, where West Texas and Brent Crude were both trading lower, to $90 and $98 per barrel respectively.

Why the sudden decrease after weeks of climbing steadily?

“I think what we're seeing is markets are hoping that potentially instead of just leaving the problem, that the Trump administration may be looking to restart talks," noted Patrick DeHaan with Gasbuddy.com. "We'll have to see if these potential talks develop. Obviously, there's a lot of pain in the market with diesel prices and gasoline remaining very elevated. And ahead of the midterms, that's why the Trump administration may be changing its tune and looking to start talks again with Iran.”

Fuel Prices Continue To Move Higher

DeHaan said while oil prices were moving lower to start the week, fuel prices continued to climb. Gasoline prices inched up again nationwide this week, and diesel prices remain at an all time high in Washington at $7.37 a gallon. The national average is roughly $6.18 a gallon.

While many questions remain about possible U.S./Iran talks, as well as Russia/Ukraine, DeHaan said consumers may start to see some relief at the pump, thanks to the calendar.

“We may see a little bit of relief in the weeks ahead," DeHaan said. "Typically gas prices do decline in the fall with lower consumption and a switch over back to cheaper winter gasoline that may help ease the specifications and refineries overseas may be able to produce more gasoline for the U.S. market. But whether or not we see much of that relief is really contingent on ongoing escalations or potential de-escalations in these geopolitical tensions that have arisen.”