Gas prices across the US are projected to fall in the new year in 2024 for the second successive year resulting in a net saving of about $32 billion on fuel costs for the Americans.
Oil experts predict that US gas prices will average $3.38 a gallon in the key election year of 2024 representing a significant improvement from this year’s average of $3.51 a gallon and an even bigger drop from the average of 2022 of $3.95.
Gas prices skyrocketed to record highs that year as Russia’s invasion of Ukraine set off global shockwaves, media reports said.
Gas stations around the country boosted prices by an average of 26 cents a gallon over the past month, as irregular temperatures made fuel-making more challenging due to the slowing of cooling processes needed to refine crude oil.
Even as the Russia-Ukraine war still lingers and there is a risk the Israel-Hamas war spills into a regional conflict, GasBuddy, an oil and gas analyst, is betting drivers will get more relief in 2024.
GasBuddy expects Americans will spend about $32 billion less on fuel than in 2023 and $79 billion less than in 2022.
“Next year should represent a continued march towards what most Americans would consider normal prices at the pump,” Patrick De Haan, GasBuddy’s head of petroleum analysis, told CNN.
The price drop forecast bodes well for consumers. White House can exercise caution as optimism emerges while fighting an uphill battle trying to sell its economic message to a sceptical public, CNN analysts wrote.
Cheaper gas prices would give the Federal Reserve a carte blanche as it seeks to pull off a rare soft landing of the US economy by taming inflation without starting a recession. The Feds closely monitor gas prices but it’s not included in its “core” inflation gauge.
“Gas prices may still be a bit elevated but considering wage growth, it is taking less of Americans’ hard work to pay for that gallon of gasoline,” De Haan said.
GasBuddy doesn’t see gas prices averaging $4 a gallon in any single month next year.
The US is an energy power house that pumps more oil than any other country in the world , according to S&P Global Insights.
In December 2022, GasBuddy projected gas prices would average $3.49 a gallon in 2023. That forecast was nearly spot-on, with actual gas prices averaging $3.51 a gallon so far this year.
