Gas Prices Reach a New Record High, When Will Gas Prices Peak?

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Last updated Jan 30, 2023
gas prices record high

According to data from GasBuddy, the national average cost of one gallon of gasoline surpassed the 2008 record on Monday, March 7, 2022. The average price per gallon now stands at $4.10. AAA’s average is now $4.07, however several states are already over $4.50. How high will gas prices go, and what will it take to bring prices back down? 

Likely the First of Many Records

Energy experts predict gasoline prices to reach $4.50 at a minimum, with $5.00 not out of the question nationally. In California, the price of a gallon of gas is already $5.34. GasBuddy Head of Petroleum Analysis Patrick De Haan shared his predictions given the current state of affairs. “Most of the areas east of the Rockies are at low risk for some of the apocalyptic numbers like $5 and $6 per gallon…This is something that could change very quickly, but I don’t see that in most areas of the country just yet.”

Diesel prices average $4.63 per gallon, but are headed for $5.00 per gallon. GasBuddy petroleum analysts expect the record of $4.84 to be broken within two weeks. 

When Will Gas Prices Peak?

Energy analysts point to the Russian invasion of Ukraine as the overwhelming cause of spiking prices. Russia is responsible for about 7% of global oil supply. Talk of cutting off Russian oil exports to Europe and America is raising oil prices to $130 per barrel on fears of further instability. In 2008, the price per barrel of oil hit a record $147. That record may be within reach, especially as warmer weather brings higher demand for fuel.

Analysts say that prices will rise and remain elevated until global instability calms and subsides. In other words, once Russia’s invasion of Ukraine ends. However, we’re entering spring, and warmer weather historically heralds higher gas prices. On average, gas prices in America rise about fifty cents per gallon in March and April. 

US May Ban Russian Oil Imports

On Monday, anonymous sources familiar with ongoing discussions told Reuters that the United States is seriously considering a ban on Russian oil imports as yet another sanction. The move has bipartisan support from lawmakers. In a Monday meeting, US officials tried to get European nations to join the Russian oil ban, but apparently none of them were willing to make the move.

The U.S. only gets about 3.5% of its oil from Russia, so Rabobank energy analyst Ryan Fitzmaurice told CNN that a U.S. ban would have symbolic significance. However, the European Union relies on Russia for over one quarter of its crude oil. A ban in the EU would have far greater effects. In Germany, gasoline sold for an average of $7.72 USD per gallon ($2.04 per liter) at the end of February. Shutting off Russian pipelines would send prices even higher.

A lot can change in two years. Back in April of 2020, quarantine shutdowns sent gas prices sinking to an average of $1.74 nationally. Many of us saw gas for under one dollar per gallon. Who knows where prices will be two years into the future. 

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