The price of oil dropped below $100 a barrel Tuesday for the first time since early May when the national average of gas was about 40 cents cheaper.
For four months, drivers have been bearing with record high gas prices pleading to know when’s the peak – and when will they drop?
“Yeah, I only got a Costco membership just for the gas,” said Deep of San Jose.
Many drivers looked for relief filling up at the Costco near SJC, which has some of the cheapest gas in the South Bay.
Get a weekly recap of the latest San Francisco Bay Area housing news. Sign up for NBC Bay Area’s Housing Deconstructed newsletter.
“I always try to save money when I can, but especially during this time [gas] is going like hotcakes. Everyone is going to Costco,” said Elaine Le of San Jose.
Oil nearly hit $140 per barrel in March, the highest since 2008.
But on Tuesday, it dropped below $100 a barrel, which some oil analysts say is due to fears of a recession, but prices are still high.
“People are reluctant to cut their prices when things are good for them,” said Robert Chapman Wood, SJSU global economics professor.
The last time oil was at the same price it was Tuesday was early May.
Nationwide, gas was $4.32 a gallon, now it’s $4.80.
“When there’s some apparent reason to cause prices to go down, competition isn’t really perfect,” said Chapman Wood. “Nobody wants to be the one that cuts the price and potential launching of a price war.”
He said demand is up in the summer and drivers will need to see a sustained drop in oil to see the change at the pump.
Drivers still aren’t happy.
“That’s America for you,” said Le. “Capitalism.”
Some experts believe prices could fall to around $60 per barrel by the end of the year if a recession hits, but that could have a lot of other negative impacts.
Others expect it’ll take much longer.