Merced County Times Newspaper
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Gas prices to fall nearly 50 cents per gallon

$4 remains possible in the summer season

After a tumultuous year for gas prices, some relief may be on the way in 2023.

The yearly national average price of gas in 2023 is forecast to drop nearly 50 cents per gallon from that of 2022 to $3.49, according to GasBuddy’s 2023 Fuel Outlook.

Continuing improvement in refinery capacity will help alleviate gasoline and diesel prices, though high levels of uncertainty remain amidst Russia’s ongoing war on Ukraine and continuing economic concerns. A $4 national average remains possible ahead of and during the summer driving season.

Highlights from GasBuddy’s 2023 Fuel Outlook:

• The national average price of gas could cool early in the year as demand remains seasonally weak, followed by a rise that starts in late winter, bringing prices to the $4 per gallon range in time for summer. Barring unexpected challenges, prices in 2023 should return to normal seasonal fluctuations, rising in the spring, and dropping after Labor Day into the fall.

• Though most major U.S. cities will see prices top around $4 per gallon, areas of California like San Francisco and Los Angeles could again experience near $7 gas prices again in the summer of 2023 if refineries struggle under mandates of unique formulations of gasoline.

Americans will spend an estimated $470.8 billion on gasoline in 2023, down $55 billion from 2022. The estimated yearly household spend on gasoline will also fall $277 to $2,471. “2023 is not going to be a cakewalk for motorists. It could be expensive,” said Patrick De Haan, head of petroleum analysis at GasBuddy. “The national average could breach $4 per gallon as early as May – and that’s something that could last through much of the summer driving season. Basically, curveballs are coming from every direction. Extreme amounts of volatility remain possible, but should become slightly more muted in the year ahead. I don’t think we’ve ever seen such an amount of volatility as we saw this year, and that will be a trend that likely continues to lead to wider uncertainty over fuel prices going into 2023.” 
The highest gasoline prices are forecast to be seen in June, with an estimated peak of up to $4.19 per gallon on average. Diesel prices are forecast to average $4.12 in 2023, beginning the year at their highest level and then rebounding as high as $4.30 per gallon in June.

To start the year …

Average gasoline prices in California have risen 6.0 cents per gallon in the last week, averaging $4.32/g today, according to GasBuddy’s survey of 10,526 stations in California.

Prices in California are 40.8 cents per gallon lower than a month ago and stand 30.1 cents per gallon lower than a year ago. The national average price of diesel has fallen 1.4 cents in the last week and stands at $4.67 per gallon.

According to GasBuddy price reports, the cheapest station in California was priced at $3.18/g yesterday while the most expensive was $7.79/g, a difference of $4.61/g. The average gas price in Fresno this week was reported as $4.02/g, up 1.6 cents per gallon from last week. Modesto’s average was $3.94/g, up 6.7 cents per gallon from last week.

The national average price of gasoline has risen 12.3 cents per gallon in the last week, averaging $3.17/g today. The national average is down 22.5 cents per gallon from a month ago and stands 9.5 cents per gallon lower than a year ago, according to GasBuddy data compiled from more than 11 million weekly price reports covering over 150,000 gas stations across the country.

Avg. CA prices in history:

  • Jan. 2, 2022: $4.62/g (U.S. Average: $3.26/g)
  • Jan. 2, 2020: $3.59/g (U.S. Average: $2.59/g)
  • Jan. 2, 2016: $2.87/g (U.S. Average: $1.99/g)
  • Jan. 2, 2014: $3.64/g (U.S. Average: $3.32/g)

“For the first time in two months, the nation’s average price of gasoline rose sharply last week, as extremely cold weather led to many refinery issues, shutting down over a million barrels of refining capacity, pushing wholesale prices up,” De Haan said. “In addition, China’s reopening plans gave markets inspiration that global oil demand will start to recover, as China’s nearly three year Covid-zero policies appear to be coming to an end. While the jump at the pump will likely be temporary as most refiners get back online after cold-weather related issues, some regions like the Rockies may see more price increases than others as cold-weather shutdowns hit the region fairly hard, with one refinery likely remaining down through the first quarter of 2023. Most areas have seen the bulk of the rise already hit, but should oil continue to rally, more increases could be on the way.”

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