Oil Prices Plummet as US-Iran Ceasefire Stokes Hope for Gas Price Relief

The US-Iran ceasefire has sent oil prices plummeting, sparking hopes of relief from soaring gasoline costs. The two-week truce, announced on Wednesday, has seen U.S. oil prices drop by 15% to around $95.50 a barrel.

Retailers are expected to pass the savings on to consumers in the form of lower gas prices within days, with some analysts forecasting that the national average price could fall below $4 per gallon within one or two weeks.

However, others caution that sustained price reductions will depend on the durability of the ceasefire and the resumption of tanker traffic through the Strait of Hormuz, a vital oil-shipping route. The Strait was effectively closed during the war, leading to an oil shortage that sent gasoline prices surging worldwide, including in the US.

Ramanan Krishnamoorti, a professor of petroleum engineering at the University of Houston, said that 'gasoline prices will come down, but I think we're in for a bumpy ride.'