Could Gas Prices in Your State Reach $6? One Analyst Thinks So

Costco Gas Station stock photo
Fang Zheng / iStock.com

The one thing most Americans had going for them during the current runup in gasoline prices is that they could always say, “Well at least I don’t have to pay as much as they do in California.” But drivers across the United States might soon feel the same pain Californians are feeling right now — $6-a-gallon gas — if demand continues to outpace supply at the current rate.

Discover: 11 Best Prepared-Food Deals at Costco
More: 25 Extra Grocery Costs You’re Probably Forgetting About

Natasha Kaneva, head of global oil and commodities research at JPMorgan, told CNN in a May 17 email that “there is a real risk the price could reach $6+ a gallon by August.”

Her comment came just as the average price of gasoline pushed about $4 a gallon in all 50 states, according to AAA — the first time that’s ever happened. The national average stood at a record high of $4.567 a gallon on May 18. California, which is far and away the most expensive state in which to buy gas, saw its average exceed $6 a gallon.

Make Your Money Work for You

The prospect of $6-a-gallon gas throughout the country seemed inconceivable not too long ago. But it’s not so far-fetched anymore, with U.S. gas prices surging in the aftermath of Russia’s invasion of Ukraine, compounded by a growing imbalance between supply and demand.

Gasoline inventories in the United States are at their lowest seasonal levels since 2019, CNN Business reported, just as demand is on the rise amid an easing of COVID-19 restrictions and the coming summer travel season.

“With expectations of strong driving demand… [the] U.S. retail price could surge another 37% by August,” JPMorgan analysts wrote in a report titled “Cruel Summer.”

If you’re looking for a silver lining in all of this, keep in mind that average prices aren’t what they charge everywhere. In California, for example, more than half (52%) of stations sell gas for less than $6 a gallon, and nearly one station in four sells it for $5.75 a gallon or less.

Make Your Money Work for You

Because some stations inflate the average by hiking their own prices, drivers across the U.S. could see some stations at $6 a gallon even if the national average never reaches that high.

Not All Experts Agree That Gas Will Hit $6 Per Gallon Nationwide

Meanwhile, some industry experts sound doubtful that the national average will ever rise as high as $6 a gallon.

“It’s hard to get to $6,” Andy Lipow, president of Lipow Oil Associates, told CNN. “Before we get there, we would have significant demand destruction, not only here, but around the world.”

See: POLL: Have Gas Prices Affected Your Driving Habits?
Find: As Gas Prices Break Record Highs Again, Which States Are Paying the Most at the Pump?

Patrick De Haan, head of petroleum analysis at GasBuddy, has a similar take.

“I personally think we’d see a recession before we’d see a national average of $6,” he told CNN, but then added that he “[doesn’t] think much is impossible in this market.”

More From GOBankingRates

About the Author

Vance Cariaga is a London-based writer, editor and journalist who previously held staff positions at Investor’s Business Daily, The Charlotte Business Journal and The Charlotte Observer. His work also appeared in Charlotte Magazine, Street & Smith’s Sports Business Journal and Business North Carolina magazine. He holds a B.A. in English from Appalachian State University and studied journalism at the University of South Carolina. His reporting earned awards from the North Carolina Press Association, the Green Eyeshade Awards and AlterNet. In addition to journalism, he has worked in banking, accounting and restaurant management. A native of North Carolina who also writes fiction, Vance’s short story, “Saint Christopher,” placed second in the 2019 Writer’s Digest Short Short Story Competition. Two of his short stories appear in With One Eye on the Cows, an anthology published by Ad Hoc Fiction in 2019. His debut novel, Voodoo Hideaway, was published in 2021 by Atmosphere Press.

Best Bank Accounts of June 2022

Untitled design (1)
Close popup The GBR Closer icon

Sending you timely financial stories that you can bank on.

Sign up for our daily newsletter for the latest financial news and trending topics.

Loading...
Please enter an email.
Please enter a valid email address.
There was an unknown error. Please try again later.

For our full Privacy Policy, click here.