AAA Predicts Lower Gas Prices in 2013

AAA expects increased domestic oil production and lower demand will lead to less expensive gasoline in 2013, compared to 2012. The national average price of gasoline should peak at $3.60-$3.80 per gallon barring any significant unanticipated events.

Gasoline Fast Facts:

• Regular unleaded gasoline averaged $3.60 a gallon nationwide ($3.59 in Ohio) during 2012.
• This was a new record high. The previous record was $3.51 set in 2011 (Ohio’s 2011 average was $3.47).
• The national average price peaked at $3.94 on April 4 and 5, 2012 (Ohio’s average peaked at $3.95 on March 23, 2012).

Last year’s record high gasoline prices were the result of production disruptions from refinery fires, pipeline closures, major hurricanes and higher oil prices due to tensions in the Middle East. These types of market-moving events are impossible to predict and any forecast on gasoline prices can change as a result of similar factors.

Looking ahead to 2013, historical trends indicate that gasoline prices should rise steadily through April or early May. Prices will rise because of the typical seasonal demand increases and in anticipation of the switchover to more expensive summer-blend gasoline.

Following a late-spring peak, prices should drop during the first half of the summer to as low as $3.20-$3.40 per gallon nationwide, before rising again in advance of the Gulf Coast hurricane season and the switchover to winter-blend gasoline. Prices should end the year by falling to low or near-low averages for 2013.

“Absent significant storms, major wars or production and distribution outages, the single largest factor that will influence gasoline prices in 2013 will be the strength of the U.S. economy,” said said AAA President and CEO Robert Darbelnet.

If the U.S. economy grows stronger than expected, oil and gas prices will be higher, due to the anticipation of higher consumption. On the other hand, if the economy is weaker than expected, oil and gas prices should be driven lower.

“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,” said Darbelnet.

As North America’s largest motoring and leisure travel organization, AAA provides more than 53 million members with travel, insurance, financial and automotive-related services. Since its founding in 1902, the not-for-profit, fully tax-paying AAA has been a leader and advocate for the safety and security of all travelers. AAA clubs can be visited on the Internet at AAA.com.