Pandemic recovery, demand could cause gas prices to spike

Published 7:08 pm Monday, January 17, 2022

Gas prices are continuing to rise, nationally and locally. The national average price for a gallon of regular unleaded gas is $3.304, according to GasBuddy.com, which is approximately 92 cents above last year’s average. The average price in North Carolina is $3.096 per gallon, which is 88 cents above the state’s average from last year.

Don’t expect immediate relief from those high prices.

GasBuddy, a fuel savings platform that monitors fuel prices and trends across the country, said in its 2022 fuel price outlook that the average price per gallon could peak as high as $4.13 in June, a spike “largely due to pandemic recovery and rising demand before relief, or additional oil supply, arrives later in 2022.”

“While Americans are likely to see higher prices in 2022, it’s a sign that the economy continues to recover from COVID-19. The higher prices go, the stronger the economy is. No one would love to see $4 per gallon gasoline, but we’ll only get there on the back of a very strong economy, so it’s not necessarily bad news,” said Patrick De Haan, head of petroleum analysis at GasBuddy. “There remains higher uncertainty than in a non-COVID year, but all signs point to gas prices remaining elevated next year until the high prices attract additional oil supply, which will help prices cool off as we end 2022.”

GasBuddy said most major U.S. cities could peak around $4 a gallon; some cities in California could see prices exceed $5 per gallon.

The average price in Beaufort County is currently $3.057 per gallon, according to AAA.

“According to new data from the Energy Information Administration (EIA), total domestic gasoline stocks rose by 7.9 million bbl to 240.7 million bbl last week,” AAA said in a release Thursday. “On the other hand, gasoline demand decreased from 8.17 million b/d to 7.91 million b/d. Winter weather and the COVID-19 omicron variant are the likely culprits behind this demand dip. Typically, pump prices decline due to lower gas demand and a rise in total stocks, but continued growth in the price of crude oil has helped to elevate pump prices.”

The price of crude oil was over $80 per gallon as of Monday.