$3 or Less Per Gallon Gas Prices Possible by Fall

It wasn’t that long ago when fears of $5-a-gallon gas prices were widespread, but now market analysts say $3-a-gallon or less is quite possible by autumn.
The current national average for a gallon of gasoline stands at $3.42, compared to $3.66 percent just a month ago, and down 47 cents from this year’s high in April, according to AAA’s Daily Fuel Gauge Report.
“The market suggests gas will go below $3 a gallon probably around Halloween or Election Day,” Tom Kloza, chief oil analyst at the Oil Price Information Service, said on “CBS This Morning.”
The steep drop over two months is a byproduct of several factors, chief among them oil inventories at two-decade highs, weaker consumer demand and a slowing U.S. economic recovery.
Concerns of ripple effects from the European debt crisis have also pushed down the prices of crude oil futures – off about 20 percent so far this year.
“The oil market is finally starting to catch up with the weak fundamentals,” Rick Mueller, a principal with ESAI Energy LLC in Wakefield, Massachusetts, told Bloomberg News. “The U.S. and Chinese economies are looking weaker, which is raising concerns about demand during the second half of the year.”
Slumping gas prices could help revive consumer spending before the presidential elections. Just a few weeks ago, both parties debated the rapid gas price run-up and which energy policy could help lower prices at the pumps.
Economists say lower gas prices could bolster the sluggish economy by providing a price break for both consumers and businesses hurting from high transportation costs.

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