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Gas prices slightly fall, will the trend last?

San Diego's average price per gallon was $6.31 Wednesday. That's six cents down from the record-high last week.

SAN DIEGO — Nationwide gas prices are starting to fall. San Diego's average price per gallon was $6.31 Wednesday. That's six cents down from the record-high June 15, according to AAA.

President Joe Biden on Wednesday called on Congress to suspend federal gasoline and diesel taxes for three months — a move meant to ease financial pressures at the pump that also reveals the political toxicity of high gas prices in an election year. The Democratic president will also call on states to suspend their own gas taxes or provide similar relief, the White House said.

Doug Shupe, from the Automobile Club of Southern California said even though ongoing efforts to waive federal and state taxes have been undertaken to provide consumers relief at the pump, external market and economic factors impact the price of oil, which plays a key role in determining the cost of gas.

According to the Energy Information Administration, federal and state taxes make up approximately 15% of the total price of gas per gallon paid by consumers at the pump. While the federal gas tax has remained at 18.4 cents per gallon since 1993, state gas taxes average about 30 cents per gallon – ranging from less than 10 cents in some states and over 50 cents in other states.

"Given that gas taxes make up less than a fifth of the price consumers pay at the pump, removing it offers little margin for price decreases when compared to the other factors that contribute to 85% of the price paid by consumers at the pump," Shupe said.

Alan Gin, an economics professor at the University of San Diego, said the short-term relief is partly from oil prices going down. He said the relief isn't expected to stick around long. 

Supply and demand are a driving factor. People are prioritizing their travel and mapping out trips to save on gas which is easing demand. There is concern for the long-term. 

"There's a little bit of worry about what's going to happen at the end of summer as the rest of the world economy starts to open up particularly for example China as they relax COVID restrictions," Gin said.

He said a complete boycott of Russian oil could also cause prices to surge in the future.

"If oil does hit $150 a barrel as some people are predicting that could be trouble," he said. "The price of gas could go up over $8 a gallon."

Which isn't good news for anyone especially a local food truck that relies on fuel to do business.

" All the hard work goes to the gas pretty much," said Sergio Escobar, the chef at Kikos Seafood Truck.

The expense is now eating into their profits.

"We usually fill up the tank every two days and it's about $200 every two days," he said. "It's quite expensive each week."

He said they plan to keep trucking along for now.

"We will see what happens from here," Escobar said.

The Fourth of July weekend is usually a popular time for travel which can cause prices to go up.

WATCH RELATED: Friday marks 100th day since Gov. Newsom first proposed gas tax rebate idea (June 2022)

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