As Americans continue to grapple with economic pressures, the price at the gas pump has become a notable area of financial reprieve. For 2026, projections indicate an average national gasoline price of approximately $2.97 per gallon. Should this forecast hold true, it would mark the fourth consecutive year of declining pump prices and the first instance of annual average gas costing less than $3 since 2020.
This development contrasts sharply with the situation in 2022, when gasoline prices soared following the onset of Russia's invasion of Ukraine. The conflict triggered a surge in oil costs that pushed gasoline prices above the unprecedented threshold of $5 per gallon, coinciding with inflation rates in the United States exceeding 9%.
Patrick De Haan, head of petroleum analysis at the fuel savings platform GasBuddy, noted that the market appears to have stabilized as it continues to recover from Covid-related disruptions. "We're finally out of the woods with the market rebalancing after Covid," De Haan remarked, emphasizing sustained improvements in fuel affordability.
The forecast from GasBuddy was developed prior to recent geopolitical developments involving a U.S. military strike and subsequent capture of Venezuela’s President Nicolas Maduro. Despite these events, De Haan indicated that short-term fuel prices are unlikely to be affected significantly, citing the considerable time required to rehabilitate Venezuela's deteriorated energy infrastructure. "In the short term, we see little disruption or shift as a result of the events over the last few days," he said.
Following the U.S. intervention in Venezuela, oil futures showed minimal overnight change, reinforcing the perspective that these geopolitical factors will not immediately influence fuel pricing trends.
This downward pressure on gasoline prices provides some counterbalance to the broader affordability challenges faced by many consumers. Rising costs in other domains, including grocery items, electricity, and home heating, continue to affect household budgets. However, the expectation of lower fuel prices could alleviate some financial strain.
Based on GasBuddy’s projections, American consumers are poised to spend roughly $11 billion less at the pump in 2026 than in 2025. Average gas expenditures per household are anticipated to decrease to $2,083 for the year, down from $2,716 in 2022.
Furthermore, ten states are predicted to experience particularly low average gas prices, with annual averages below $2.75 per gallon. These states include Alabama, Arkansas, Kansas, Louisiana, Mississippi, Missouri, Oklahoma, South Carolina, Tennessee, and Texas.
Seasonally, GasBuddy anticipates a modest peak in monthly gas prices in May at $3.12 per gallon, correlating with the transition to summer-grade fuel and increased consumer demand. Following this peak, prices are expected to decline, finishing the year at around $2.83 per gallon.
The current pricing trend, which continued into 2025 when the annual average fell to $3.10 per gallon, is attributed to a global decrease in crude oil prices. That year saw oil values drop by 20%, marking the largest annual decline since 2020.
According to analysis of FactSet data, crude oil prices have recorded four consecutive quarters of decline, the longest such stretch since late 2001. Reflecting these trends, the U.S. Energy Information Administration (EIA) projects oil prices to average $51 per barrel in 2026, down from $65 in 2025 and $77 in 2024.
De Haan emphasized that the inexpensive nature of oil and gasoline is driven not by a reduction in demand but by an increase in supply globally. He highlighted OPEC, led by Saudi Arabia, for its decision in 2025 to sharply increase oil output amidst pressure from then-President Donald Trump.
In the United States, oil production has remained robust, though not achieving the rapid expansion envisioned under the "drill, baby, drill" approach promoted during Trump's administration. Preliminary EIA estimates indicated that U.S. production stood at approximately 13.83 million barrels per day by late December 2025, near the all-time high of 13.86 million barrels per day reached in early November and modestly above the levels at the conclusion of the Biden administration.
Nonetheless, persistently low prices have driven some U.S. oil companies to revise their drilling plans downwards. Federal data forecast a slight decline in U.S. oil output for 2026, with production expected to decrease by 100,000 barrels per day, averaging 13.5 million barrels daily.
>De Haan cautioned consumers about becoming overly confident in the expectation of prolonged low prices, noting that diminished U.S. production could eventually shift greater market influence back to OPEC nations.
Certain uncertainties could disrupt the forecast for inexpensive oil and gasoline. Instability stemming from the U.S. military action in Venezuela could lead to broader regional tensions, potentially elevating energy costs. Additionally, ongoing conflict in Ukraine has resulted in attacks on Russian energy infrastructure by Ukrainian forces. Recent warnings from Iranian officials about potential targeting of U.S. troops in the Middle East amid protests add another layer of geopolitical risk.
Another variable includes the possibility that OPEC might reverse its policy of raising production, opting instead to reduce output to counteract low prices.
Despite these potential challenges, the prevailing outlook suggests that gasoline will continue to provide a relative bright spot for consumers facing economic stress in the near term.