Report: Gas Prices Could Average $4 per Gallon Nationally by Late Spring

Gas prices could climb to a national average of $4.00 per gallon by late spring of 2022, according to a report by GasBuddy, a company that tracks fuel prices across North America.

In a report published Wednesday morning, the company predicted that national gasoline prices could range anywhere between $3.52 – $4.06 per gallon next May, with a national average potentially reaching $3.79 per gallon. GasBuddy predicts similar prices in June, as it estimates national gas prices could span between $3.43 – $4.13, with a national average of $3.78 per gallon.

“A national average of $4 per gallon is possible this spring, largely due to pandemic recovery and rising demand before relief, or additional oil supply, arrives later in 2022,’” GasBuddy wrote in a newsletter accompanying the report.

While most major cities could see prices top out at $4.00 a gallon, California metro areas such as San Francisco and Sacramento could face costs exceeding $5.00 per gallon, according to the report.

In terms of California cities, the report forecasts San Francisco’s highest daily average to peak anywhere between $5.25 – $5.65, while Sacramento is projected to range between $4.95 – $5.25. Los Angeles’s highest daily average is estimated to max out between $4.95 – $5.45.

From the GasBuddy 2022 Fuel Outlook (available here: https://t.co/ZM4GC59Eu6) How high will #gasprices go in the nation’s largest cities? Here you are: pic.twitter.com/LvQ8d8sNVf

— Patrick De Haan ⛽️📊 (@GasBuddyGuy) December 29, 2021

Currently, the average gas price in Democrat Gov. Gavin Newsom’s California registers at $4.65, according to AAA data as of December 29.  

The newsletter said prices will drop heading into the latter portion of 2022, “falling back to potentially just under $3 per gallon by the holiday season.”

GasBuddy estimates the national gas bill to reach $485 billion, which is “an increase of nearly $80 billion from last year as the average.” The average American household is projected to shell out $2,341 on gasoline throughout the year, potentially reaching the highest mark since 2014. 

In the newsletter, GasBuddy’s head of petroleum analysis, Patrick De Haan stated:

While Americans are likely to see higher prices in 2022, it’s a sign that the economy continues to recover from Covid-19. The higher prices go, the stronger the economy is. No one would love to see $4 per gallon gasoline, but we’ll only get there on the back of a very strong economy, so it’s not necessarily bad news. There remains higher uncertainty than in a non-Covid year, but all signs point to gas prices remaining elevated next year until the high prices attract additional oil supply, which will help prices cool off as we end 2022.

As of December 29, AAA pegs the national average gas price at $3.28 per gallon, which is up over a dollar from this time last year, when prices averaged at $2.25 a gallon.