$6 Per Gallon Gas Prices Could Become A Reality, Experts Say
Gas prices just continue to rise, shooting up again overnight to another new record national average of $4.567 per gallon.
As of Tuesday, every state in the U.S. had reached $4 a gallon for the first time in the country’s history, with California seeing the highest national average at $6.021 per gallon, according to the American Automobile Association (AAA). On Wednesday, the Golden State had shot up to $6.050 per gallon, the auto group indicated.
But experts warn that California may not be alone at $6 a gallon as it could become the national average before the end of the summer.
Natasha Kaneva, head of global oil and commodities research at JPMorgan, told CNN, “There is a real risk the price could reach 6+ a gallon by August.”
JPMorgan cited concerns of peak driving demands during the summer vacation season compounded by Russia’s invasion of Ukraine, CNN reported.
JPMorgan said in a report obtained by the news outlet dubbed “Cruel Summer" that “US retail price could surge another 37% by August.”
But Patrick De Haan, head of petroleum analysis at GasBuddy, thinks that gas prices could get close to $5 per gallon by the end of this week. He also suggested that a recession may hit before a national average of $6 per gallon is actually reached.
“I personally think we’d see a recession before we’d see a national average of $6,” he told CNN. However, De Haan hedged, saying that given the increasing gap between supply and demand, he didn’t “think much is impossible in this market.”
As oil prices hover around $110 per barrel, JPMorgan did add that “demand may continue to come in below our expectations,” as has occurred throughout the year by an average of 500,000 barrels per day.
Photo: Reuters