Gas Prices: Concerns Ease as Conflicts Simmer, but Hurricane Season Looms

Israel’s ongoing conflict with Iran, frequent Ukrainian drone attacks on Russian oil refineries, and OPEC’s decision to limit supply have sparked concerns of a spike in gas prices that could negatively impact the US economy and contribute to inflation. However, despite these alarming developments, average gasoline costs across America currently stand at $3.66 per gallon as of Monday, according to AAA data – down from last week’s price of $3.68 a gallon. Some experts believe that prices may have peaked for the spring or even the year ahead due to seasonal factors and an easing in tensions between Iran and Israel. Patrick De Haan, head of petroleum analysis at GasBuddy, predicts drivers will see relief soon as he believes “the worst is behind us” unless something drastic occurs that could cause prices to surge again. Tom Kloza, global head of energy analysis at the Oil Price Information Service (OPIS), also expects gasoline costs to dip in the coming weeks and argues that most concerns for the first half of 2023 are now over as hurricane season approaches. However, some analysts anticipate a small price hike with Andy Lipow, president of consulting firm Lipow Oil Associates suggesting there may be a $0.17-a gallon increase in prices to reach a peak at around $3.85 this year – still below last year’s high point of $3.98 per gallon (in September 2022).
Overall, analyst opinions about potential future trends are mixed with some experts warning that gasoline costs could potentially hit another peak later in the summer due to extreme heat causing US refineries to shut down or a severe hurricane disrupting oil production along the Gulf Coast.