Gas costs lower in 2013, analysts say
Increased domestic oil production and lower demand will mean lower gas prices in 2013. According to industry analysts, the national average price for a gallon of gas is expected to peak between $3.60 and $3.80.
The American Automobile Association says gas prices will rise steadily through April and May, but at a slower pace than in 2012. Prices are forecast to drop during the first half of the summer before they increase ahead of the hurricane season in late summer and autumn.
AAA says gas prices have the potential to end the year by falling to low or near-low averages for 2013.
AAA President and CEO Robert Darbelnet says the strength of the US economy is the biggest factor influencing gas prices.
"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 downward. 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," he said.
Tuesday'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. The average price of gasoline today is below $3.00 per gallon in six states including Colorado, Idaho, Minnesota, Oklahoma, Utah and Wyoming.The only state with an average higher than $4.00 per gallon is Hawaii.
Gasoline prices in 2012 reached record highs partly as a result of unanticipated production disruptions from refinery fires, pipeline closures and major hurricanes. Oil prices also were higher as a result of tensions in the Middle East including new sanctions on Iran. These types of market-moving events are impossible to predict and any forecast on gasoline prices can change as a result of similar factors.