The average price of a gallon of gas in Chattanooga fell 4 cents a gallon last week and will likely fall again this week with the plunge in oil prices Monday due to the continued global oversupply of oil exacerbated by the prospects of a nuclear deal with Iran and a continued debt crisis in Greece.
Crude oil prices plunged 8 percent Monday, or $4.40 per barrel, to close Monday at $52.53 per barrel in trading on the New York Mercantile Exchange. That was the deepest plunge for crude oil since early February and left oil prices at the lowest level since April.
American drivers who already are paying nearly a buck a gallon less than a year ago to fill up their tanks may have even lower prices to smile about in the future, especially if an Iran nuclear deal is in place by this week’s deadline.
The national average gas price could return to nearly $2 a gallon later this year, said Tom Kloza, chief oil analyst at the Oil Price Information Service. The national average is currently sitting at $2.77.
Kloza said all eyes are on Iran, which has the fourth biggest oil reserves in the world. If the West lifts sanctions on Iran, oil exports will increase and could push energy prices down significantly.