US: researchers believe gasoline prices could drop to $2 a gallon this fall image

As the summer is approaching and gasoline prices are still climbing since the start of the year, many drivers are beginning to wonder if their vacation drives would be costlier than last year.

But according to a Purdue University researcher the gasoline prices this summer will fall below the level seen last summer, with Wally Tyner explaining that prices would stay on average below $3 a gallon, save for California and Hawaii – where there’s a tradition to see them higher than in the rest of the country. So far, the average price of gasoline last week was $2.71 a gallon, data from AAA showed – which is 94 cents lower than for the same period of last year. Among the reasons cited for the low prices to stay below $3 a gallon is that the recent rally in global oil prices is about to end and there’s already an outstanding supply of crude oil. He added there are also unexpected developments to be accounted for, as well as political instability in oil producing countries such as Libya, Iraq, Venezuela and Nigeria.

But one thing to consider is the current deal with Iran – if US sanctions are shed away, the country’s oil could flow unhindered onto the world market – with the potential to further lower the gasoline prices by around 30 percent by next year if the Iranian oil becomes globally available. Tom Kloza, the lead global analyst at Oil Price Information Service also thinks gas prices could reach around $2.50 a gallon for the summer and then have arrange of $2 to $2.25 in the fall.

Via Forbes