Gas Prices Are Falling, a Win in Fight Against Inflation

Published On Sep 11, 2024, 6:14 AM

Gas prices in the U.S. have dropped significantly, with a gallon of regular gasoline averaging $3.39 in August, a nearly 12% decrease from the previous year. Diesel prices fell about 15% to $3.70. This decline is attributed to lower oil prices and a decrease in gasoline demand, as commuting habits have changed. U.S. oil prices fell from nearly $75 a barrel in late August to around $66 due to concerns over excess supply and reduced demand from China. The overall energy price category also saw a decline, beneficial for reducing inflationary pressures.

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Stock Forecasts

XLEView XLE chart on TradingView

Negative

Given the ongoing decline in oil prices and the reduction in gasoline demand, energy stocks may face downward pressure as profit margins shrink. Additionally, the market's reaction to the growing supply concerns may further contribute to the negativity around these stocks in the short term.

TSLAView TSLA chart on TradingView

Positive

If gasoline prices continue to fall, and consumers shift towards economic or alternative transport options, electric vehicle manufacturers could benefit from reduced operational costs for consumers, driving interest in their stocks.

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