GRAND RAPIDS, Mich. — Brent crude oil prices dropped about 7% to start this week, but drivers across the U.S. have seen a much smaller benefit at the pump — only about a 2% average decrease in gas prices, according to GasBuddy.
GasBuddy analyst Patrick De Haan said Michigan’s gas prices operate in cycles, and the current dip may be short-lived.
“The complication is that gas prices in Michigan cycle. Right now, I sense that where prices are is probably in the bottom third of that cycle. So we’re getting close to having to see prices cycle again. Today’s drop in oil will give stations a little bit more room to go a little lower. But if oil abruptly suddenly shifts and goes back up, that slack is going to be pulled out immediately, and stations will probably have to go up,” De Haan said.
De Haan said the drop in oil prices is not surprising, as there have been no new attacks in the past several days. However, how long oil prices stay down — and how much impact that has on local gas prices — depends on a range of factors both overseas and here at home.
“Even if the U.S. and Iran signed a peace deal, there’s still the possibility of who the attacks. There’s still the possibility that Ukraine strikes Russian oil refineries. There’s still hurricane season, so right now, even if one of the major issues was solved, there’s still a lot of uncertainty with the other remaining issues,” De Haan said…