On Tuesday, the price of crude oil dropped 9%, the largest drop since March. Trading for natural gas, gasoline and heating oil have also recently declined.
Severin Borenstein, from the Energy Institute at Haas School of Business, says mounting fears about a global recession is affecting oil prices.
"Overall, a slower economy means people drive less, people fly less, there’s less demand for oil to heat, and so forth mostly in other parts of the world. The reduction in demand causes a big drop in prices," Borenstein said. With so much economic uncertainty around the world, Borenstein says no one can predict if gas prices will continue to fall. He says most economists believe a recession is likely, and for now, people should do what they can to take advantage of lower gas prices.
"This is a time when you’re likely to see big differences, sometimes even just down the block. So now’s a great time to really shop around and try to find those better prices. Which not only gets you a better deal, it also puts pressure on the high-priced stations to lower their prices more quickly," Borenstein said. "Not enough, not enough. I’ve been emptying all of my money out, just to get from here to there," said Tyrone Nunley.
Borenstein says unless oil prices drop like they did at the height of the pandemic, we’ll probably see gas prices get no lower than about $6 per gallon on average in California. that I have read and agree
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