Author: Sara Clark
Good news, everyone; fueling your car in 2023 will cost you less than it did in 2022.
According to the petroleum analysis and fuel tracking app GasBuddy, the lowest gas prices will come in February, with an anticipated national average of $2.99 per gasoline gallon.
That said, gasoline prices may hit the roof during the peak travel period of summer, with an expected national average of $4 per gallon. Without further ado, let’s go over GasBuddy’s oil forecasts for 2023 and understand the various predictions and the factors behind the country’s improving oil costs.
This post looks at GasBuddy’s gasoline price predictions for 2023, the reasons behind 2023’s gas price fall, its expected summer hike, and the factors behind 2022’s oil price surges.
Let’s get started!
Falling Gas Prices To Rise Again Soon; What To Expect In 2023
How Much Will Gas Cost In 2023
According to Gasbuddy, twenty-six states have gas prices of around $3.10 per gallon. However, they expect these prices to change soon.
The fuel-savings app and gasoline price analyst say it expects gas to cost between $3.79 and $4.19 in June due to the summer travel season. The company believes the gasoline gallon price may reach as high as $4.25 in August and fall closer to $3 by the end of the year.
Top forecast models predict 2023’s national average to base around $3.49 per gallon, falling from 2022’s national average of $3.96, says GasBuddy. Relatedly, the Energy Information Administration, this month, predicts the average retail price of fuel to stay around $3.50 this year.
Why Will Gas Prices Drop In 2023
The fuel price fall can be attributed directly to several critical factors, including the return of sidelined oil refineries, recession fears, and the record-breaking emergency oil releases by the Biden administration.
After a tumultuous year of rising costs, oil prices have fallen incredibly. As we speak, the projected national average is 20 Cents less than the same period last year.
What’s Behind 2022’s Gasoline Price Hike
Oil and gasoline prices began rising in 2022 after Russia invaded Ukraine in February. European and United States sanctions on the third-largest oil-producing nation negated Russia’s ability to trade its oil.
Nonetheless, December 2022 saw gas prices in the country fall below the former cost per gallon before the Ukraine invasion.
“What America experienced in 2022 was pure chaos at its fuel pumps, with new, disappointing records being set as Russia invaded Ukraine and COVID-caused economic imbalances continued wreaking havoc, says Patrick De Haan, GasBuddy’s head of petroleum analysis.”
“While lightning striking the same spot twice seems impossible, we can’t assure ourselves that the stormy clouds looming over oil and refined products won’t persist, he added.” “Our forecast prompts us to look to the good but spikes may still be ahead as the oil market and the Ukrainian situation remains tight.”
Final Thoughts
Last year proved how difficult predicting energy prices can be. Heading into 2022, most leading forecast models predicted national averages around $3.13 for most of 2022. But that, unfortunately, was far from the case.
On a positive note, the national average currently sits around $3.10, 45 cents lower than last month’s average, 2 cents better than last week’s average, and ultimately a significant fall from the previous record-breaking national average of $5.
Nevertheless, GasBuddy in its report, states that 2023 poses a “great level of uncertainty,” making it more challenging to deliver an accurate forecast. De Haan, for example, explains that a 2023 US recession would hurt energy demand and in turn, push prices lower than forecasted.
While unexpected refinery shutdowns and major natural disasters could equate to higher-than-predicted prices. With this and 2022’s forecasting lessons in mind, it’s best to regard all predictions with caution: setting your prospects for the best and preparing your finances for the worst.