GasBuddy forecasts the lowest annual average gasoline prices since 2020, even as volatility and global uncertainty persist.
By yourNEWS Media Newsroom
U.S. motorists are expected to pay the lowest annual average gas prices in five years, according to a new outlook released Tuesday by GasBuddy, offering potential financial relief for drivers after years of elevated fuel costs.
GasBuddy projects the national average price for a gallon of gasoline in 2026 will be $2.97, down from $3.10 in 2025, based on its newly released fuel price outlook. If realized, the forecast would mark the fourth consecutive annual decline and the lowest yearly average since 2020.
Despite the downward trend, analysts cautioned that price swings will remain common due to refinery maintenance schedules, seasonal demand shifts, weather disruptions, and ongoing geopolitical pressures. Gas prices are expected to peak in the spring as the transition to summer fuel blends begins, reaching the low $3.20 range, before easing later in the year. By December, the national average is forecast to fall to about $2.83 per gallon.
Diesel prices are also expected to decline, with the national average projected at $3.55 per gallon, down from $3.62 last year.
“The world has spent years recovering from the economic whiplash of the pandemic and the shock of Russia’s invasion of Ukraine, but the situation has been improving quietly since 2022,” Patrick De Haan, head of petroleum analysis at GasBuddy, said in a statement. He added that central bank policy tightening and added refining capacity have helped ease fuel costs and that “2026 keeps that momentum going.”
“It’s not a return to ultra-cheap fuel,” De Haan said, “but for the first time in a long time, the wind is clearly behind drivers’ backs.” He added that if markets avoid major disruptions, average prices below $3 per gallon could become more common.
California continues to weigh heavily on national averages, however, with gas prices remaining above $4 per gallon across much of the state.
Overall, GasBuddy estimates motorists will spend $11 billion less on gasoline in 2026 compared with 2025. Average household fuel spending is projected at $2,083, down from $2,144 last year.
According to The Epoch Times, gas prices moved largely sideways through much of 2025 despite falling crude oil prices, before dropping sharply in November and slipping below $3 per gallon for the first time since May 2021.
As of Jan. 6, the national average gas price stood at $2.815 per gallon, down about 8 percent from a year earlier, according to the American Automobile Association. More than two dozen states now report prices below the national average, led by Oklahoma, where drivers are paying about $2.238 per gallon, the lowest in the country.
Oil market forecasts suggest the trend could continue. The Energy Information Administration’s December 2025 Short-Term Energy Outlook projects West Texas Intermediate crude to average $51 per barrel.
Uncertainty remains surrounding Venezuela, where political developments could eventually influence global oil supply. In a Jan. 5 phone interview with NBC News, President Donald Trump said U.S. oil companies could be operating in Venezuela within 18 months, potentially sooner, though he noted the effort would require significant investment.
“A tremendous amount of money will have to be spent, and the oil companies will spend it, and then they’ll get reimbursed by us or through revenue,” Trump said, adding that access to Venezuela’s heavy crude could help keep oil prices lower.
Whether U.S. producers will remain profitable at lower oil prices is an open question. The Dallas Federal Reserve estimates the Permian Basin’s breakeven price at about $61 per barrel. Exxon Mobil has said it aims to reduce its global breakeven to $30 per barrel by 2030, while ConocoPhillips has said it can remain profitable with prices as low as $35 per barrel.
Oil company stocks surged on Jan. 5 before retreating the following day. Shares of Chevron fell about 3 percent, Exxon Mobil slipped roughly 1 percent, Shell declined 0.4 percent, and ConocoPhillips finished flat.
For now, analysts say Venezuela’s situation is unlikely to significantly disrupt global oil markets. Jeffrey Roach, chief economist at LPL Financial, said in comments to The Epoch Times that Venezuela currently accounts for about 1 percent of global crude production and has been constrained by sanctions and infrastructure challenges for years.
“With global production exceeding 100 million barrels per day and major suppliers like the United States, Saudi Arabia, and Russia dominating the market, any disruption in Venezuelan output is unlikely to create significant supply shortages,” Roach said.
Crude prices were little changed on Jan. 6, with WTI futures dipping about 0.3 percent to $58.15 per barrel and Brent crude falling nearly 0.2 percent to $61.66 per barrel.
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