The sharp decline in oil prices on Thursday marked an additional positive development for inflation just before the Thanksgiving travel rush.

The price of US oil dropped almost 6% to $72.16 a barrel, the lowest level since July 7.

In contrast to earlier this fall when oil was on track to hit $100 a barrel, the selloff continues a sharp reversal. Since late September, crude has fallen 23% to nearly $94 a barrel.

Oil prices could drop even further for Thanksgiving as a result of the latest plunge in oil prices. AAA reported that average US gasoline prices had fallen to a 10-month low of $3.34 a gallon before Thursday’s oil selloff.

According to AAA, just over 49 million Americans are expected to hit the road this Thanksgiving, up almost 2% from 2022.

Oil market selling is attributed to growing concerns about oversupply and weakening demand, including in China.

Last week, US crude stockpiles increased by 3.6 million barrels, according to federal data released Wednesday. The results exceeded analysts’ expectations by a wide margin.

Oil prices are in what’s known as contango, meaning they’re higher in the future than they are today. This phenomenon is sending a bearish signal to the market, said Robert Yawger, Mizuho Securities’ vice president of energy futures.

The refineries are also processing less oil, suggesting there is a low demand for oil, according to Yawger.

Meanwhile, the Israel-Hamas war has not disrupted regional supplies as many had feared at the beginning of the conflict.

GasBuddy’s head of petroleum analysis Patrick De Haan said that he hasn’t seen risk materialize from the Middle East.