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Gas prices face upward pressure pending decision on Iran Nuclear Deal, analysts say

Brandon Paykamian • Updated May 7, 2018 at 5:47 PM

The recent steady increase in gas prices slowed over the past week, but analysts believe there’s a chance we could see more upward pressure on prices once again.

As the world holds its breath until President Donald Trump decides whether to extend the Iran nuclear deal by May 12, analysts from GasBuddy and AAA say the price of oil depends on this decision. 

Killing the deal could create higher gas prices, as it may lead to sanctions placed on Iran and its oil production, according to a Monday report from GasBuddy analysts.

"The rise in gas prices has slowed substantially in the last week in some places, with 15 states seeing gas prices move lower versus last week," said Patrick DeHaan, head of petroleum analysis for GasBuddy.

"While we may not be out of the woods yet, especially with President Trump mulling over the Iran nuclear deal, it's possible we're very close.”

According to a Monday press release from AAA, Sunday’s national gas price average stood at $2.81, while Tennessee’s gas prices stood at $2.59. The state’s average is the same as last week, and 22 cents less than the national average.

Some of the most expensive gas in the state is in Kingsport and Bristol, which had average prices of $2.65. Johnson City’s average stood at $2.63.

Last week, analysts from AAA said they didn’t expect the national average price for regular unleaded gasoline to hit $3 a gallon once again.

But with further geopolitical tensions adding to the anxiety over Syria, as well as previous agreements between OPEC and non-OPEC nations to cut production and create a price floor, the next few weeks could be unpredictable.

"Preliminary projections had gasoline averaging around $2.75 this summer," AAA spokesman Mark Jenkins said in a press release. "However, all bets are off right now, pending the president's decision on the Iranian nuclear deal.

“Gas prices were relatively stagnant last week, but we could see a slight boost, based on oil price gains last week and the potential for additional hikes in the coming days.”

For more information on local, state and national gas prices, visit www.gasbuddy.com or www.gasprices.aaa.com.

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