Gasoline prices to continue downward slide in 2016, says GasBuddy

“Southern California is now the only region in the USA with gas price averages above $3 a gallon, but that could change soon in response to plummeting local wholesale prices as supply fears from unplanned maintenance may have reached an end, ” says Jeffrey Spring, a spokesman for the Automobile Club of Southern California.

Prices were doing just that in Kamloops Friday with Costco offering the lowest in town at 93.9 cents a litre and about half of city gas stations reporting prices below the $1 mark.

The average price across the U.S.by May will be about 65 cents higher than it is now, according to GasBuddy’s projections. “Especially given that this time of year, it’s gasoline that gets a lot of downward pressure placed on it as refineries really have no maitenance issues and again this is a slow and low demand period”. Brent crude fell Wednesday to $34.21, a 5 percent drop from Tuesday.

A rise in gasoline taxes could also affect prices.

“If I look at wholesale prices for gasoline on the markets, you’re paying about 14 cents a litre above market prices for gasoline”.

Analysts with GasBuddy noted those concerns in forecasting prices for 2016, when they projected the national average per-gallon price would dip another 12 cents, to $2.28. A hike in the federal gasoline tax is unlikely given its an election year.

The glut of global-oil and the tanking price of a barrel is driving down the price at the pump. AAA listed Missouri as having the lowest average, $1.70, with five states at $1.75: Alabama, Arkansas, Oklahoma, South Carolina and Tennessee. Most states will experience peak prices in April or May, while a minority will peak in June.

What factors could impact how much we pay for gas in 2016?

Energy prices are a large part of budgets for many consumers and companies, but they are not as crucial to the American economy as they used to be. The contrast was even greater compared with Hawaii, where the statewide average was 79 cents lower than past year. The global market has pushed oil prices lower and, barring the unexpected, that will continue, said Patrick DeHaan, head petroleum analyst for GasBuddy. Hawaii traditionally has the highest prices because of its location and having to import all of its oil.