AAA Predicts Gasoline to Cost Less in 2013

AAA Predicts Gasoline to Cost Less in 2013

January 9, 2013

(AAA news release) Gasoline prices this year will be less expensive than in 2012 as a result of increased domestic oil production and lower demand, according to AAA.

According to a story posted on the AAA website:

The national average price of gasoline should peak at $3.60-$3.80 per gallon barring any significant unanticipated events, which compares to a peak of $3.94 a gallon in 2012.

“Cheaper gas prices are good news for the millions of Americans that depend on their car to travel where they need to go,” said AAA President and CEO Robert Darbelnet. “Lower gasoline prices should translate into billions of dollars in tangible household savings given that the vast majority of Americans rely on automobiles to live their lives.”

Gasoline prices should rise steadily through April or early May, but at a slower pace than last year. As is typical for this time of year, prices will rise as a result of seasonal demand increases and in anticipation of the switchover to more expensive summer-blend gasoline. Following a late-spring peak, prices should drop during the first half of the summer to as low as $3.20-$3.40 per gallon before rising again in advance of the Gulf Coast hurricane season and the switchover to winter-blend gasoline. Prices should end the year by falling to low or near-low averages for 2013.

“Absent significant storms, majors wars or production and distribution outages, the single largest factor that will influence gasoline prices in 2013 will be the strength of the U.S. economy,” continued Darbelnet. “Stronger than expected growth in the economy would result in higher oil and gasoline prices in anticipation of higher consumption, while a weaker than expected economy would drive prices downwards. Inaction by Congress to reach a debt deal in two months also would result in increased concern about the U.S. economy and could lead to lower gasoline prices.”

Today’s national average price of gasoline is $3.30 per gallon, which is seven cents less than last year and five cents less than a month ago. Motorists in 39 states today are paying lower average gasoline prices than a year ago. States paying more than last year are located primarily in the Northeast, which is still dealing with the supply aftereffects of Hurricane Sandy. The average price of gasoline today is below $3.00 per gallon in six states including Colo., Idaho, Minn., Okla., Utah and Wyo.. The only state paying more than $4.00 per gallon is Hawaii.

The annual average price of gasoline in 2012 was the most expensive on record at $3.60 per gallon, but the situation for motorists is already improving. On Jan. 5, the national daily average dropped below the year-ago price for the first time since August 20, which means motorists are now paying less for gasoline than last year – a trend that AAA believes is likely to continue.

 

 

Read the entire story from the AAA Newsroom HERE.

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