Gas prices are said to be on the rise and won’t see a decrease for a while…but when?
New reports from AAA and the U.S. Energy Information Administration (EIA) say that although gas prices have been on the rise recently, they should start falling as oil prices fall and temporary production concerns are resolved. Looking ahead, the EIA predicts in its Short Term Energy Outlook that the national annual average retail price for a gallon of regular gasoline will fall from $3.63 per gallon in 2012 to $3.55 per gallon in 2013 and eventually to $3.39 per gallon in 2014.
Current retail gas prices…
Have been higher than they were a year ago. According to AAA’s recent Fuel Gauge Report, the national average price for a gallon of regular unleaded gasoline was $3.59 on Tuesday, Feb. 12. This price is six cents higher than it was the week before, up 28 cents from the same day in January, and up eight cents from the average price a year ago.
These higher prices are largely due to regional refinery issues and the approaching switch to summer blend gasoline. Barring geopolitical tensions, as in Libya in 2011 and with Iran in 2012, AAA expects that the rate of increases to the national average (gas prices) will slow and that this price will peak during the spring at a lower price than they did during the last two years, at $3.98 per gallon in 2011 and $3.94 in 2012. For diesel, EIA predicts the average retail price for a gallon of diesel will fall to $3.92 per gallon in 2013 and to $3.82 per gallon in 2014.
Although weather-related issues have contributed to regional price differences in the last few months (for example due to Super Storm Sandy at the end of 2012), the recent winter storm Nemo had a minimal effect on gas prices (despite long lines), according to AAA, and likely resulted in reduced demand rather than less supply.
Gas prices are still high on a regional basis, though, despite predictions of lower prices down the road. California and the Mountain states saw the largest price increases last week. The average gas price in Nevada went up 18 cents since last week; in Colorado it was 15 cents higher; in Arizona 14 cents higher; and in Utah it was up 12 cents. Drivers in Hawaii face the highest price, at $4.24 per gallon, according to AAA.
Will there be light at the end of the tunnel? Maybe…However, if we expect it to come it will be a lot harder for us to deal with the in-between times. It isn’t time to dwell on these forecasts and predictions, it’s time to be prepared for whatever happens to gas prices, good or bad. It’s time for everyone to look into fuel economy and fuel-cost savings.