Will average gas prices be above $3.940?

The strongest structural advantage for this market is the sheer math of the required price decline. As of April 22, 2026, the AAA national average sits at $4.020, providing an 8-cent buffer above the $3.940 threshold. To resolve NO, the national average must sustain a drop of at least 1.6 cents per day for five consecutive days. Retail gas prices are notoriously sticky on the way down, and the daily rate of decline has already decelerated sharply, dropping just 0.2 cents between April 21 and April 22. Fundamental supply and commodity data further reinforce this price floor. The Energy Information Administration reported a massive 6.3 million barrel draw in gasoline inventories for the week ending April 17, indicating tighter-than-expected supply. Concurrently, WTI crude oil has rebounded to the $90 per barrel range following stalled ceasefire negotiations and ongoing shipping restrictions in the Strait of Hormuz. Because AAA national averages typically lag wholesale and crude movements by several days, the recent upward pressure on crude will likely arrest any remaining retail price slide before the April 27 resolution. Station owners are slow to pass on wholesale savings, and with wholesale costs now stabilizing or rising, there is no fundamental catalyst to force an 8-cent retail drop in such a compressed timeframe.

The primary risk to the thesis is the sheer velocity of the recent downward trend. The national average shed 9.8 cents in the seven days leading up to April 22, driven by the unwinding of a massive geopolitical risk premium. If this pace of 1.4 cents per day resumes and slightly accelerates, the average could easily slip below the $3.940 mark by resolution day. Leading indicator states demonstrate that rapid, double-digit declines are entirely possible in the current environment. AAA Michigan reported a 15-cent weekly drop to $3.83, well below the national target. If localized supply gluts or sudden demand destruction spread to other high-volume, high-volatility markets like Texas or Florida, the national average could be dragged down much faster than historical base rates suggest. Furthermore, any sudden geopolitical de-escalation could trigger a wholesale price collapse. If a definitive US-Iran peace treaty is signed and the Strait of Hormuz is fully reopened to commercial shipping, crude oil could plummet by $10 to $15 per barrel overnight. This would compress wholesale crack spreads and potentially spark aggressive retail price wars as stations compete for volume in a falling market.