Ross Gerber, CEO of the investment firm Gerber Kawasaki,said on Monday that lower oil prices would benefit both the stock market and the economy, as it would translate into lower costs for households and businesses.

In a post on X, Gerber said, "If oil breaks lower we expect markets to react very positively. It’s critical for the economy to see lower gas prices asap."

A drop in oil prices would ease inflation, boosting consumers' purchasing power and allowing them to spend more on products and services. But the economist warned that the gasoline price would take time to come down.  

Oil Prices Drop

Oil prices dropped sharply on hopes of a peace deal between the U.S. and Iran. West Texas Intermediate futures dropped to roughly $91 a barrel, while Brent slipped below $98.

In a Truth Social post, President Donald Trump said negotiations with Iran are "proceeding nicely" and that the outcome will be "a Great Deal for all or, no Deal at all." He added the alternative was a return to "the battlefront and shooting, but bigger and stronger than ever before."

However, oil prices retreated somewhat on Tuesday, driven by new U.S. strikes in southern Iran.

On Monday, economist Mohamed A. El-Erian said on X that the movement of the oil price in the weeks ahead would depend on the full operation of the Strait of Hormuz, along with the terms of the agreement. He stated, "Where this crucial price goes next will depend not only on whether the agreement is finalized but also on the details and what they imply for sustainability—particularly with respect to the return of free navigation through the Strait of Hormuz."

Gas Prices Decline

Gasoline prices fell to $4.507 from $4.515 per gallon, per AAA data. GasBuddy analyst Patrick De Haan predictsgas prices will fall in the coming days following talks of a possible deal.

He said the gasoline price would likely remain "well above $4" per gallon until a definitive agreement between the U.S. and Iran is signed and significant shipping transit resumes through the Strait.

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