GasBuddy Fuel Price Outlook 2015

Accuracy, reliability, and neutrality are GasBuddy®’s mission with price forecasting, and it is achieved with independent analysis featured in this outlook.

It should be noted that this outlook is not indicative of what will happen, rather what we believe could happen, given specific inputs and different impacts and scenarios on production, supply, and demand.

Gasoline markets are complex, and this analysis is intended to take current factors and speculate on how today’s events may impact gasoline prices in the future.

GasBuddy® has worked to make these forecasts as reliable as possible and to be understood by anyone with little or no background on oil and petroleum markets and economics.

Significant Volatility

With OPEC’s recent shift in attitude in the last few months- cutting oil prices and seeking to regain market share- there remains a question of how long OPEC and its members will stay this course. Should attitude and policy reverse towards a desire of higher oil prices, this may dramatically alter this forecast.

Refinery maintenance season and a shift back to EPA mandated cleaner burning gasoline during the late winter and early spring generally culminates in an increase of 35-75 cents per gallon in gasoline prices. In a typical year, there are several unexpected problems that arise during complex turnarounds that refineries conduct. The West Coast and Great Lakes states are most susceptible to price shocks if unexpected issues arise during maintenance seasons.

While the U.S. escaped a major hurricane last year, hurricane season has brought significant harm to oil infrastructure in the last decade, and while hurricanes are not guaranteed to impact such facilities, such an event could interrupt notable infrastructure and drive up gasoline and other refined product prices.

Gasoline taxes are being evaluated in several states. Even the federal government may look at increasing taxes on gasoline, something it hasn’t done since 1993. Several states have already raised prices with the New Year, and several other states are identifying best methods to raise funding for road repairs- any new taxes will push prices higher than expected.