Gas prices this year could be the lowest since 2020, new forecast predicts

Gas prices in the U.S. are expected to hit a new low in 2026, with the average price per gallon dropping to $2.97, according to a recent analysis by GasBuddy. This decrease of 13 cents from the previous year is attributed to several factors such as strong refinery output, lower oil prices, increased crude production, and softer seasonal demand. Patrick De Haan, head of petroleum analysis at GasBuddy, noted that while it’s not a return to ultra-cheap fuel, drivers can expect some relief at the pump this year.

Despite the overall decrease in gas prices, drivers should brace for some volatility throughout the year. GasBuddy predicts that prices will peak around $3.20 per gallon between spring and early summer before falling to an average of $2.83 after June. This pattern of fluctuation is common due to seasonal demand, weather conditions, and geopolitical risks.

The price of gas can vary depending on where you live in the country. While states in the Gulf Coast and South are anticipated to have prices well below $3 per gallon for the year, regions like California, the Northeast, and cities like Chicago may see higher prices. GasBuddy projects that the average household will spend around $2,083 on gas in 2026, slightly lower than the previous year.

For drivers of diesel-powered vehicles, there is also some good news. Diesel prices are forecasted to average $3.55 nationally in 2026, down from $3.62 in 2025, providing some relief for those who rely on diesel fuel.

Overall, the outlook for gas prices in 2026 is positive for consumers, with the potential for savings at the pump compared to previous years. It’s important for drivers to stay informed about price fluctuations in their area and take advantage of tools like the GasBuddy app to find the best deals on fuel.