Gas prices forecast to be lower in 2019, saving motorists billions | News Coverage from USA

Gas prices forecast to be lower in 2019, saving motorists billions

Motorists have something to look forward to in 2019 – cheaper gas.

For the first time in three years, annual prices at the pump are expected to decrease from the year before, saving Americans billions of dollars.

The price of a gallon of self-serve regular gas will average $2.70 nationally, according to a GasBuddy.com forecast provided exclusively to USA TODAY. That’s 3 cents less than 2018’s average of $2.73. But that’s still more than what drivers paid in recent years. In 2017, gas averaged $2.39 a gallon and dipped as low as $2.13 in 2016. 

“2019 sets the stage for the first decline in the yearly national average since 2015, but before motorists drive for joy, it may be prudent to remind them that 2019 will still be the second most expensive year to fill up since then,” said Patrick DeHaan, head of petroleum analysis at GasBuddy. 

In January, drivers will enjoy the lowest price of the year with an average cost of $2.35 per gallon. May prices will average $2.97 per gallon, making it the most expensive month of the year, according to GasBuddy, an app that provides information on fuel prices and availability at nearby stations.

None of those figures come close to the highest recorded daily average of $4.11 in July 2008. The highest recorded yearly average, $3.60, occurred in 2012. 

The typical American family will spend $1,991 on gas in 2019 – $25 less than the previous year, according to GasBuddy. Americans are forecast to spend $386 billion on gasoline in 2019, down $2.5 billion from $388.5 billion spent in 2018.

More: ‘Dramatic drops’ in gas prices: Less-than-$2 gas is here for many American motorists

More: Gas plummets to 2018 low as oil’s slide delivers savings

Cities in California are expected to see the highest prices in 2019, with daily averages totaling $4.10 in Sacramento, $4.15 in Los Angeles and $4.20 in San Francisco. California gas prices tend to be higher than elsewhere in the nation because it sells a specially formulated blend to address environmental concerns.  

Meanwhile, the big cities with the lowest daily averages are in Texas, with Houston topping out at $2.90 and the Dallas area at $2.95.

Floridians may see daily prices peak at $3.15 in Miami, while Tampa and Orlando could top out as high as $3.05 for a gallon of gas. Daily peak prices in Northeastern cities like New York City could reach $3.35. Philadelphia’s peak price is forecast at $3.30.

Gas figures typically hit their highest point in the spring as gasoline sold during the warmer months is more expensive to produce than winter blends and more people on the road increases demand. 

Last year’s lower pump prices were linked to a decision by the Organization of the Petroleum Exporting Countries (OPEC) to extend production cuts. In December, OPEC and its allies, including Russia, agreed to cut oil output by 1.2 million barrels per day in order to bolster prices. 

If OPEC is successful in implementing its crude oil production plan, then prices will lean toward the high end of GasBuddy’s forecast since higher oil prices tend to translate into higher gas prices.

The direction of gas prices is also contingent on government budget decisions. Direct moves by governments to increase fuel taxes, like those seen in California in November, and international tariffs could add to the prospect of higher prices for fuel in the year ahead.

“In some respects, putting an accurate forecast together for fuel prices in 2019 feels like playing darts blind and hoping for a bullseye,” DeHaan said. “Some of that feel comes from the White House playing an increasing role in volatility. You never know what President Trump might do or say.”

Due to concerns about the economy and a glut of petroleum production, December’s gas prices were the lowest of the year with nearly 20 percent of states enjoying prices below $2 per gallon, according to the American Automobile Association (AAA).

Missouri averaged $1.87 per gallon while Mississippi and Alabama saw gas at $1.95.

“For now, enjoy the bargain-basement prices,” DeHaan said. “Because spring’s ‘new merchandise’ will probably be a pretty penny higher.” 

Follow Dalvin Brown on Twitter: @Dalvin_Brown

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *