Gas prices hold steady as supply grows: AAA

Gas prices on average are expected to dip from their 2022 peaks overall this year, but $4 a gallon is possible this summer.

The national average for a gallon of gas dropped one cent from the previous week to $3.42, according to AAA’s latest report. Today’s national average is 12 cents more than a month ago, but nine cents less than a year ago, AAA reported.

Weak demand for gas is the primary reason why prices haven’t made major movements, AAA said. Gas demand dipped slightly from 8.43 million to 8.27 million barrels a day last week, according to the Energy Information Administration (EIA).

"The national average for pump prices dipped to $3.41 before creeping a bit higher over the past two days," AAA spokesperson Andrew Gross said. "And this trend of small increases could persist into next week."

These are the 10 states that have seen the sharpest changes in gas prices.

Colorado (+13 cents)
Nevada (+12 cents)
Indiana (+10 cents)
Florida (-9 cents)
Maryland (-9 cents)
New Mexico (+7 cents)
Delaware (-7 cents)
Utah (+6 cents)
Alabama (-6 cents)
New Jersey (-5 cents)

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Gas prices expected to dip as supply grows

Despite an expected spike in gas prices this summer, the costs at the pump are expected to cool in the U.S. overall in 2023, according to a forecast by GasBuddy.

"After a tumultuous year for gas prices, some relief may be on the way in 2023," GasBuddy said in its forecast. "The yearly national average price of gas in 2023 is forecast to drop nearly 50 cents per gallon from that of 2022 to $3.49, according to GasBuddy’s 2023 Fuel Outlook released this past Friday. Continuing improvement in refinery capacity will help alleviate gasoline and diesel prices."

Gasoline prices on average are expected to peak at $4.19 per gallon in June. Diesel prices are forecast to reach an average high of $4.12 in August. Americans are expected to spend an estimated $470.8 billion on gasoline in 2023, GasBuddy reported. But that’s down $55 billion from 2022. The estimated yearly household spend on gasoline will also fall to $2,471 from $2,748 in 2022, the report said.

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Uncertainty remains

Although gas prices are projected to fall from their 2022 highs this year, there is still speculation that the course may reverse. These fears include the ongoing war between Russia and Ukraine, which can impact the supply of global oil. Another is China’s oil production as it moves away from its pandemic-era restrictions.

"China’s potential easing of COVID mandates could provide a strong upside to our forecast," GasBuddy said in its report. "OPEC is also likely to try to balance oil markets that tip out of balance by cutting oil production in late 2022 to address slowing demand. Russia’s war on Ukraine also brings additional uncertainty.

"Basically, curveballs are coming from every direction," the report continued. "Extreme amounts of volatility remain possible, but should become slightly more muted in the year ahead. I don’t think we’ve ever seen such an amount of volatility as we saw this year, and that will be a trend that likely continues to lead to wider uncertainty over fuel prices going into 2023."

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