Remember when gas prices spiked to $4 a gallon a few years back? Well you don’t have to cringe quite yet, but you might want to brace for a hit to your wallet this year.
Prices at the tank are expected to jump by an average of 36 cents nationwide, according to price tracker GasBuddy.com. That’s the highest since 2012, when gas prices peaked at $3.60. They’ve declined every year since until a most recent low of $2.13 last year. A decrease in crude prices is largely credited for low fuel prices.
In St. Louis, gas prices are expected to average around $2.70 to $2.95 per gallon, above the national average of $2.49. Prices in Chicago could reach an average of more than $3 a gallon. Since last week alone, prices have increased by more than 6 cents nationwide, and by 36 cents since this time last year. While consumption in the U.S. remains flat, oil production worldwide has increased.
The projected increase means Americans will spend $52 billion more in 2017 on gasoline than they did in 2016, according to analysis from GasBuddy.
Countless factors can impact when and why gas prices spike, though the prime suspects are the type of fuel available, global economies, crude oil prices, supply and demand, taxes and, you guessed it, politics. It’s cheaper to fill up your tank in Missouri, for example, because the state only charges 17 cents per gallon on motor fuel, while Illinois charges 19 cents per gallon plus local sales tax.
Gas prices could also jump later this winter and into spring because of the switch from “winter blend” to “summer blend” fuel. The Environmental Protection Agency requires refineries to switch blends twice a year, according to AAA. Winter blend fuel burns more efficiently in cold weather while summer blend is more efficient when the temperature rises. The summer blend contains 1.7 percent more energy than the winter blend, according to the EPA, though it is more expensive to produce, sending gas prices higher in the warmer months. Prices will likely begin to rise in February and peak in May, increasing between 35 to 60 cents per gallon.
Volatility in the Middle East and potential changes under the new Trump administration could also affect fuel prices in the coming months. Gregg Laskoski, a senior petroleum analyst for GasBuddy, said anticipated economics improvements in the U.S. could soften the blow of higher gasoline prices.
“If the Trump administration delivers on its promises — lower taxes, more jobs, higher salaries and savings — then a concurrent increase in demand and gasoline prices may be easier to digest,” Laskoski said.
GasBuddy compiles motor fuel prices from more than 130,000 gas stations in the U.S.
2017 gas prices by the numbers
- The highest average gas prices should be seen in San Francisco ($3.85), Los Angeles ($3.75), Washington, D.C. ($3.60), Philadelphia ($3.60), New York City ($3.55) and Sacramento ($3.55).
- The lowest average gas prices should be seen in Houston and Dallas-Fort Worth ($2.50), Tampa and Atlanta ($2.65), and Phoenix and St. Louis ($2.70).
- Americans are expected to spend $52 billion more on fuel in 2017 than in 2016.