With the busy summer travel season approaching, many are wondering how high could U.S. gas prices get?
Prices hit a nationwide record on Tuesday, May 24 — $4.598 a gallon — according to AAA.
This comes after a JPMorgan analyst predicted a “cruel summer” with gas prices potentially hitting a nationwide average of at least $6 in a Global Commodities Oil Flash Note published May 17.
“With expectations of strong driving demand — traditionally, the US summer driving season starts on Memorial Day, which lands this year on May 30, and lasts until Labor Day in early September — US retail price could surge another 37% by August to a $6.20/gal national average.”
Here’s what experts say as Memorial Day nears:
Supply and demand for fuel
“Typically, refiners produce more gasoline ahead of the summer road-trip season, building up inventories. But this year, since mid-April, US gasoline inventories have fallen counter seasonally and today sit at the lowest seasonal levels since 2019,” the JPMorgan report said.
The disconnect between supply and a higher seasonal demand is why the analyst has predicted prices could spike further and hit $6, a price never seen before, according to the report.
Patrick De Haan, GasBuddy’s head of petroleum analysis, told McClatchy News over the phone that for “various reasons,” roughly half a dozen refineries have been lost in the U.S. since 2019 and “amidst demand, that’s very high.”
“There’s a diminished ability for refineries to meet that demand. So they’re going to be critical this summer delivering enough fuel,” he added.