National Gas Price Falls Below $4 a Gallon for First Time Since July

Brent crude, the global oil benchmark, briefly traded below $90 a barrel on Tuesday after futures dropped 13% last week, the steepest weekly decline since April 2020, NBC News reported. Oil had already fallen another 5% on Monday, to its lowest level since Aug. 31.

The slide followed President Donald Trump’s comments last week and on Monday playing down a new round of strikes on Iran. Traders also bet that Democratic gains in the midterm elections could make the war harder to fund and sustain.

Oil, Season and the Strait

Pump prices had already been easing as stations switched from summer-blend gasoline to cheaper winter fuel after Sept. 15, and as seasonal driving demand faded. AAA says prices typically fall 10 to 30 cents a gallon in the winter months.

Patrick De Haan, head of petroleum analysis at GasBuddy, said the move was seasonal rather than a direct result of the election, and that more oil moving through the Strait of Hormuz was also helping. He told NPR the national average could reach $3.75 a gallon by Thanksgiving “so long as we don’t get any wild cards geopolitically.”

GasBuddy, which compiles station-level reports, put the national average at $3.96 a gallon on Monday and said that was its first reading below $4 since early August. AAA’s daily national average crossed under $4 on Tuesday, the first such print since July 20.

On Election Day the nationwide regular average was $4.14, NBC said. A week earlier it was $4.1493, according to AAA, and had stayed above $4 since late July.

Still Above Prewar Levels

Even after the drop, regular gasoline remains far costlier than a year earlier, when AAA’s average was $3.0707. NBC said prices are still up more than 30% since the United States and Israel launched the Iran war on Feb. 28, and around 40% since the start of the year.

Diesel has also eased, to $6.1572 a gallon from $6.2875 a week earlier, but it remains much more elevated than gasoline. NBC said diesel is still up more than 70% since the beginning of the year, under pressure from the Iran war and from attacks on energy infrastructure in the Russia-Ukraine war.

The U.S. strategic petroleum reserve is at its lowest level since 1982, NBC reported, after releases this year aimed at capping prices.

Trump Plays Down New Strikes

The oil sell-off began after Trump told NBC News last week that he did not plan to attack Iran, and it continued after Democrats posted large midterm gains. On Monday, he again signaled he would hold off on new strikes, telling reporters at the White House that “Iran militarily is effectively over” and that Washington was “just keeping it the status quo.”

He said there was “positive momentum” in talks and a “good chance” the war “could get ended.” He added: “The military action doesn’t seem to be a very necessary thing, but we’re locked and loaded, ready to go for any reason that changes.”

Vice President JD Vance wrote after the results that “the reason we lost is the war.” Trump has separately said it is “largely true” that the conflict, and the rise in gasoline prices, cost Republicans the midterms.

ING commodities strategists said Democratic control of Congress would likely bring “more scrutiny over the war, while funding it could become more difficult.” Sources told NBC News that Trump was briefed Friday on a narrow window for a potential new military campaign against Iran, with no decision taken.

Citigroup analysts warned that the lame-duck period before the new Congress is seated on Jan. 3 could still bring “accelerated dealmaking or renewed escalation.”