By Kelli B. Grant
Drivers can expect to see more favorable prices at the pump for the rest of the summer.
The International Energy Agency announced that it plans to release 60 million barrels of oil from its emergency stocks over the next 30 days. That decision, made to counterbalance losses from supply disruptions in Libya, pushed crude-oil futures down about $5 to $90 a barrel Thursday morning.
Consumers have already seen a little relief in gas prices this month as the Greek debt crisis and uncertainties about the U.S. economy pushed crude prices lower, says Ben Brockwell, a director for the Oil Price Information Service. The national average for a gallon of regular unleaded has dropped steadily over the past month, from $3.83 to a current average of $3.61, according to AAA’s Daily Fuel Gauge Report. “The IAE’s decision means a more forceful, quicker descent for oil,” he says. “You’ll see this converted quickly into savings at the pump.”
It’s unclear just how much more drivers can expect to save, but because the release is meant to supplement an expected shortfall, the drop of a few cents is likely to be short-lived, says Avery Ash, the manager of regulatory affairs for AAA. Prices are likely to hover at the lower end of the $3.25 to $3.75 range already predicted for the summer, he says.
Consumers could see savings in other places, too, as the effect of cheaper gas trickles through the supply chain, Brockwell says. Although it’s unlikely that prices will drop on say, food or clothing, fuel surcharges may be lessened and companies may be able to put off expected price hikes.