Easing restrictions fuel cost of filling up

The national decrease in COVID-19 cases and lessening of shutdown restrictions were the main drivers of rising gasoline prices this year, industry analysts said.

However, there are mixed forecasts as to what will happen at the pumps if we continue to make progress against the pandemic.

Just as skyrocketing case totals changed driving habits, reduced the demand for gas and prompted oil refiners to slash production, good news on the COVID front has somewhat reversed those trends, said Patrick De Haan, head of petroleum analysis for gasbuddy.com.

“As COVID goes, so have gas prices,” he said.

While GasBuddy believes prices

will likely rise more heading into summer, the federal Energy Information Administration projects that prices will decrease somewhat as oil production gets closer to prepandemic levels.

Analysts agree, though, on what a stark difference COVID had on the cost of gas.

U.S. gasoline demand in the last week was the highest spring number released by EIA in two years, and only about 3% below the same week in 2019.

Other influences

There are factors other than the lessening pandemic that have increased gas prices, according to EIA, including two that occur each year: the annual switch to cleaner burning but costlier summer-blend gases that producers are required to make by May 1 each year and the traditional increase in demand as warmer weather leads to more driving.

But the recent economic recovery also has played a part, according to the EIA.

The EIA predicts crude oil will average $64 per barrel this summer, up 78% from last summer’s average of $36 per barrel.

Crude oil production has started ramping up in the U.S. and globally, and though it remains below prepandemic levels, refinery output and rising crude oil supply from OPEC and U.S. oil producers should begin to push down gasoline prices over the summer, EIA said.

They acknowledge, though, that their projections are uncertain.

For the summer, the EIA forecasts regular retail gasoline prices to average $2.78 per gallon, decreasing to an average of $2.62 by September.

No presidential impact

Though many are linking the beginning of President Joe Biden’s administration to the rise in gas prices this year, De Haan said the two are not connected.

“Gas prices are not determined by the president, but by consumers filling their tanks,” he said.