WEX’s August fuel prices report found that demand was up in July and August and that the crisis in Syria is pushing the price of crude oil higher. WEX noted that the U.S. Department of Energy reported that demand for gasoline increased close to 1 percent compared to the same period in 2012. That said, analysts predict demand will eventually fall as newer, more fuel-efficient vehicles arrive on U.S. roads and the population continues to age.
The crisis in Syria has pushed crude oil prices above $100 per barrel even though that country is not a major oil supplier and the U.S. doesn’t receive much oil from that region. Domestic U.S. production has increased to levels not seen since the 1980s, according to WEX, and forecasts predict the U.S. will use more oil from North America in the future. WEX went on to state that most experts predict crude oil prices will fall once the crisis is resolved, with wholesale prices falling as refiners switch to producing winter spec fuel.
Looking ahead, analysts predict the national average price for a gallon of gasoline could drop below $3.25 per gallon before the end of the year and some regions could see prices as low as $2.50 per gallon.
Analysts predict diesel prices, on the other hand, will rise to greater than $4.00 per gallon as winter approaches and the demand for heating oil rises.