Gas prices are dependent on a number of hard-to-predict factors, including hurricanes in the Gulf of Mexico and political developments in the Middle East and elsewhere, but analysts at GasBuddy made an "eerily accurate" forecast in 2023, and they're predicting prices will fall again in 2024, CNN reports. In December 2022, they predicted that 2023 prices would average $3.49 a gallon, down from $3.95 in 2022. The 2023 average turned out to be $3.51, just 2 cents above GasBuddy's projection. For 2024, they're predicting an average of $3.38 a gallon, with prices peaking at $3.67 in May before falling to $2.99 by December.
GasBuddy predicts that Americans will spend $32 billion less on fuel in 2024 than they did in 2023. "Next year should represent a continued march towards what most Americans would consider normal prices at the pump," Patrick De Haan, the company's head of petroleum analysis, tells CNN. Analysts say that the US is on course to pump more oil than any country in history this quarter, keeping prices down and providing stability for US consumers. "The US producing record amounts of crude oil translates to lower risk," De Haan says.
But the picture isn't entirely rosy. De Haan says one major worry is limited US refinery capacity, which means supplies can take a big hit if extreme weather events knock even one refinery out of action. Another wild card, he says, is "decaying" relations between the US and OPEC+, the alliance of oil producers that include Saudi Arabia and Russia. Major oil companies, meanwhile, went on a $250 billion buying spree in 2023, consolidating control of oil fields, including the Permian Basin in West Texas, and more mergers and acquisitions are expected in 2024, reports Reuters. (More gas prices stories.)
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