NJ gas prices are falling. Tensions in the Middle East could change that

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Analysts say gasoline prices are falling from their summer peaks, but given the uncertain hurricane season and escalating tensions in the Middle East, the relief for motorists is likely to be short-lived.

On Tuesday, drivers in New Jersey paid $3.30 for a gallon of gasoline, travel club AAA said. A week ago, it was $3.33 and a month ago, it was $3.49, AAA data shows.

Tom Kloza, an energy price analyst at the Maryland-based Oil Price Information Service, told MarketPlace that gasoline prices have been low this summer because demand has been low.

According to the U.S. Energy Information Administration, demand for gas has continued to decline in recent weeks, while refinery activity and fuel inventories have increased.

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Patrick De Haan, chief petroleum analyst at GasBuddy, and Andrew Gross, a spokesman for AAA, said essentially the same thing: Rising geopolitical tensions in the Middle East could drive up oil prices in the region, leading to higher costs at the pump.

US authorities have identified signs that Iran is preparing an attack on Israel in response to the assassination of a senior Hamas leader in Tehran last week, and Israel is continuing its military operations in the Gaza Strip.

White House national security spokesman John Kirby told reporters on Monday that “there could be action from Iran as early as this week.”

“We need to be prepared for a range of potentially significant attacks,” Kirby said, according to a White House pool report.

But barring a potential escalation of the conflict in the Middle East, “gasoline prices have reached their summer peak,” Andy Lipow of Lipow Oil Associates in Houston told Yahoo Finance.

The risk of a hurricane in the Gulf States – and especially in Texas and Louisiana, where most of the country’s refineries are located – also suggests an uncertain development in gasoline prices this summer and fall.

Tropical Storm Debby completely missed the Gulf region and instead moved up the east coast last week.

This article contains material from USA Today.

Daniel Munoz covers business, consumer affairs, labor and the economy for NorthJersey.com and The Record.

E-mail: [email protected]; Twitter:@danielmunoz100 and Facebook

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