What Do Summer Fuel Prices Have in Store for Us?

Summer is traditionally a time for having fun in the sun. Unfortunately, it’s also normally a time for high fuel prices. The spike in gas costs can be attributed to a number of factors; for one, because more people are traveling, there’s a spike in demand. Another reason for price hikes is the ‘summer blend’ of gas, a higher grade of fuel that is meant to resist evaporating in higher temperatures and costs a little bit more per gallon. 

As you likely know if you’ve been anywhere near a car recently, gas prices have been a hot topic for over a year. After all, last summer’s gas prices were the highest they’d been in the United States since 2014, before settling at an average of about $3.80 around Labor Day 2022. 

While many families will see themselves at the pumps more in the coming months as they embark on road trips and vacations, businesses with mobile employees whose livelihoods depend on driving for work are affected by what they have to pay at the pump, too. So what kind of prices can they expect to see this summer?

What Impacts Summer Gas Prices?

One of the reasons that gas prices cause so much anxiety among drivers is that a number of factors contribute to their fluctuating figures. The first of these is, of course, increased demand, with fuel demand trending 10-15% higher in August than in February. This increased demand means that any outside stress on the oil and gas industry, such as pipeline or refinery outages, have the potential to cause even higher price hikes. 

Another factor, as mentioned above, is costs faced by retailers when they switch to summer-grade gas in order to meet seasonal Reid vapor pressure requirements. Refiners are required to make this change by the first of May, while retailers are required to do so by no later than June 1. 

Global economic conditions can have a big impact on the cost of gas, as well. Gas and oil production are hugely affected by the world market. This year, fears of a recession in the United State are a factor, as the U.S. not only produces 20% of the world’s gas, or about 18.88 million barrels a day as of 2021, but it is also the world’s top oil consumer, as well. Conditions in other oil-producing countries, such as Russia, which is currently embroiled in a war in Ukraine, also play a part in prices at your local gas station. 

The Summer 2023 Forecast

With all of that to consider, how can we expect gas prices to shape up this summer? 

While gasoline prices have a long way to go before they reach the numbers of a couple of years ago—when COVID-19 lockdowns kept people inside and gas prices low—they aren’t expected to be nearly as high as the records set last summer. The Energy Information Association (EIA) predicts that this summer, regular-grade gas will be about 80 cents on the gallon less than the price last summer, or about $3.50 a gallon. 

Traditionally, gas prices tend to climb in the spring before peaking around Memorial Day. In keeping with that trend, the projected $3.50/gal price is a jump from March’s average of about $3.42/gal, and expected to stay above $3.45/gal through the month of August.  

CompanyMileage Helps you Control Mileage Reimbursement 

When it comes to trying to track gas prices, there are a ton of factors at play, and prices can fall —and spike—drastically. But even with oil prices preparing to go up for the summer, companies who use SureMileage, CompanyMileage’s mileage reimbursement application, never have to worry about employee mileage reimbursement costs getting too out of hand. 

Unlike other methods of calculating mileage, our unique point-to-point system ensures that you never end up inadvertently paying employees for personal mileage. Plus, our automated system means that mileage amounts can’t be manually inflated, making it a fast, easy, and cost-effective way to reimburse mobile employees for work-related mileage driven in their personal vehicles. 

CompanyMileage customers save up to 30% on mileage reimbursement expenses when they implement SureMileage. To find out how you can save this summer, too, contact us for a free demo today!