It’s been a wacky year thus far for gas prices. The cost per gallon usually retreats in the slow-demand month of February, but this year, prices rose. Not because of a sudden increase in demand, mind you, but for a host of other reasons that brought about assumptions that the national average would easily top $4 a gallon by Memorial Day, and that 2012 would easily surpass 2011 as the priciest year ever for gasoline. Now, though, after fears of $4, or even $6 gas have caused airlines to raise fares and travelers to change summer plans, gas prices are declining—and they’re expected to keep falling well into the high-demand days ahead.
In recent days, word has begun spreading that gas prices, long assumed to keep on rising with the temperature this spring, may have unceremoniously already hit their peak. As of Thursday, the AAA Fuel Gauge Report listed the national average for a gallon of regular at $3.891, down from $3.907 the week before, and not all that much higher than the average from a month ago ($3.846), or a year ago for that matter ($3.837).
Similarly, according to Consumer Reports weekly gas price roundup published on Tuesday, the national average had decreased 2¢ over the prior seven days, with prices declining in all parts of the country except for the Rocky Mountain region and New England. GasBuddy data indicates that the price per gallon in Chicago is down to $4.23, after nearing $4.70 not long ago.
(MORE: Top 10 Most Buzzed-About New Small Cars)
Now, the Wall Street Journal reports, after gas prices have seen an overall decline nationally for two straight weeks, gasoline price futures have dropped for four consecutive days, indicating that prices at the pump will keep right on falling as well. Retail prices for gasoline typically follow the lead set by gas futures pricing, but it usually takes a few weeks for prices at the pump to catch up—and in this case, decline.
Why the change? Among the explanations: Tensions with Iran have dissipated; refineries that had been closed or were being renovated are back in business, increasing overall output; and sustained low levels of demand among drivers, who have been shifting to cars with better mileage in anticipation of higher gas prices, and who are driving less overall for a whole host of reasons.
(MORE: Off the Road: 8 Reasons Why We’re Driving Less)
Mostly, per the WSJ, investors and speculators seem to have reached a consensus that gas futures won’t rise as earlier predicted, and it becomes a self-fulfilling prophecy, in which gas futures decline because money managers believe they will decline—and then prices at the pump follow suit:
“What you’re seeing in the market is some back-pedaling from the hysteria we saw in February and March,” said Sander Cohan, a principal at ESAI, an energy-consulting firm in Wakefield, Mass.
The speculators have been wrong in the past—the very recent past, actually—and so obviously they could also be wrong about what’s going to happen with gas futures and gas prices in the near future. Few analysts would rule out the possibility of the national average still topping $4, or perhaps even $4.25 per gallon, but most don’t expect it to hit $4.50, let alone $5. Not this year anyway.
(MORE: The Future of Oil)
One analyst at GasBuddy would only go so far as to predict continued volatility in gas prices through May. As for the question he’s been fielding often lately—Have gas prices already peaked?—his standard answer is this noncommittal one: “I’d like to think they have, but as soon as such a statement is made, prices seemingly go slightly higher.”
Brad Tuttle is a reporter at TIME. Find him on Twitter at @bradrtuttle. You can also continue the discussion on TIME’s Facebook page and on Twitter at @TIME.