economy
Why oil prices are falling faster than gas prices after the Iran ceasefire
When President Donald Trump announced the ceasefire with Iran and the reopening of the Strait of Hormuz on Tuesday, the oil market immediately reacted, showing a sharp drop in the price per barrel, while regular gas prices have been slower to adjust to the news.
TL;DR
- President Donald Trump announced a ceasefire with Iran and the reopening of the Strait of Hormuz.
- Oil prices immediately dropped over 18% following the announcement, falling below $100 per barrel.
- Prior to the announcement, oil prices had spiked to over $117 per barrel.
- National average gas prices have remained around $4.16 per gallon since the ceasefire news.
- Wholesale oil prices are more volatile than retail gas prices, causing a delayed adjustment in consumer prices.
- Gas prices will take longer to adjust to the opening of the Strait of Hormuz for oil tankers.