(Source: MIRS.news, Published 01/03/2023) Gas prices in Michigan are going up as 2023 bursts onto the scene and those prices aren’t expected to slow down, according to a petroleum forecast by GasBuddy.
The 2023 GasBuddy Fuel Price Outlook predicted the national average could go above $4 per gallon by May, with some cities, such as Los Angeles and San Francisco nearing the $7 mark.
“2023 is not going to be a cakewalk for motorists. It could be expensive,” said Patrick De Haan, head of GasBuddy petroleum analysis.
The forecast is predicting a peak national average of $4.19 in June. Diesel national average prices are forecast to hit $4.30 in the same month.
“Extreme amounts of volatility remain possible but should become slightly more muted in the year ahead. I don’t think we’ve ever seen such an amount of volatility as we saw this year, and that will be a trend that likely continues to lead to wider uncertainty over fuel prices going into 2023,” De Haan said.
AAA Michigan spokesperson Adrienne Woodland said it's that volatility that makes petroleum predictions difficult.
“In Michigan, we hit a high of $5.22 in June, our low was in December at $2.95. That’s a $2.22 difference and that’s just in one year,” Woodland said.
The GasBuddy forecast acknowledged the unknown, with the biggest volatility factors being major weather events, unknown geopolitical events, and refinery problems, such as fires or equipment problems.
One of the driving factors for the GasBuddy prediction is an increased demand for fuel from China as the COVID-19 lockdowns are lifted.
“Americans love to hold onto the myth that politicians are all-powerful and all-knowing, but when it comes to gasoline prices, global influences on supply and demand are really the gremlin that determines prices, and politicians who only care about your vote would love you to think they can control everything, but really can’t do much over global fundamentals driving prices down or up,” De Haan said.
Woodland said current average prices of gas in Michigan have increased to $3.20, which is a 21-cent increase from the end of the holiday season. The price is up 10 cents from the same time in 2022.
“Michigan motorists are seeing higher gas prices as they ring in 2023,” she said. “An increase in crude oil prices to close out 2022, along with a busy holiday travel season, have led to higher pump prices.”
Woodland said the 2022 travel season was predicted to be the third highest travel year since 2000, with 2019 being the first. She said AAA does not have the concrete numbers yet, as the offices reopened Tuesday from the holidays.
“The winter storm also threw a wrench into things,” she said.
Several refineries along the Gulf of Mexico were forced to shut down because of weather right before Christmas.
Woodland said many people plan their trips well in advance and travel regardless of gas prices, but those prices could impact what vacationers do during the time off.
“They may not dine out as much, they may spend less on shopping or they may look for free activities,” she said.
She said people now would be planning spring trips or getting ready to plan summer vacations.
“If you plan to travel in 2023, now is a great time to get with a trusted travel advisor and see what some of your options are,” she said.
