U.S. Gasoline Price to Increase at Record Pace in 2022
Americans may see a $4 increase per gallon of gasoline next year, according to a new forecast by GasBuddy, an app that tracks fuel prices and energy demand.
“We could see a national average that flirts with, or in a worst-case scenario, potentially exceeds $4 a gallon,” Patrick De Haan, GasBuddy’s head of petroleum analysis, told CNN,
The forecast runs counter to the current trend in which gasoline prices have been coming down, reaching a national average of $3.29 a gallon on Monday, down 13 cents from the peak of $3.42 on Nov. 8, according to AAA.
Prices will rise again in 2022, GasBuddy contends, because several major refineries in Louisiana and Texas are down and demand is soaring, creating a perfect storm in which already strained supplies will be stretched further. Refinery capacity fell to a six-year low in 2021.
By May, prices will peak, reaching a monthly average of $3.79 a gallon and then slowly come down to $3.57 a gallon in July, eventually reaching $3.01 a gallon by December as demand cools off, GasBuddy predicts.
If a new coronavirus variant hits next year, all bets are off as demand will likely crash as it has during the Omicron outbreak, GasBuddy said.
“Anything could change,” de Haan said. “Tomorrow there could be a ridiculous variant and prices could plummet.”
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The White House is taking credit for the slight ebb in gas prices right now.
“As people head out for the Christmas weekend, gas prices continue to drop — down 25 cents a gallon in many places since @POTUS announced the globally-coordinated strategic petroleum release,” White House chief of staff Ron Klain tweeted on Dec. 23.
Klain was referring to the release of 50 million barrels of oil from America’s reserve stash, which the White House announced the week of Thanksgiving in an attempt to counter rising gas prices.
But others pointed out that gasoline prices are up a whopping 46 percent from this time last year when on Christmas Eve the average price per gallon was $2.25.