Gas prices to remain high through 2021. Could we see $4 per gallon early next year?

Posted at 6:40 AM, Oct 18, 2021
and last updated 2021-10-18 06:40:19-04

(WXYZ) — Now is the time of year when we usually start to see a bit of relief at the pump. Instead, we are seeing some of the highest gas prices since the recession in 2008.

According to AAA Michigan, we're averaging about $3.30 per gallon across metro Detroit, about $1.19 more than this time last year. The current statewide average is about the same.

Usually, with the switch from a summer to a winter gas blend, along with a decrease in demand, we see prices fall a bit. That has not happened, and gas experts are warning drivers, don't hold your breath.

On Sept. 16, gas stations started switching back to the winter blend. It's cheaper to produce, and normally means cheaper prices, but not this time.

Between Hurricane Ida, a global energy crisis and the pandemic, gas prices are stuck above the average of $3 per gallon.

Patrick DeHaan, an analyst with GasBuddy, said it's not impossible, but improbably, the average price of gas will go below $3 per gallon the rest of the year in metro Detroit.

"I'm more worried here in the weeks and months ahead, we will continue to see prices push up a bit, we probably won't get to record territory, but it is setting up for a very uncertain and probably pricey 2022 at the pump," he said.

That means start pinching pennies now if you plan on driving this holiday season.

"Based on what we know now, I think to expect prices to remain over $3 a gallon through the holidays, maybe even it could worsen," he said.

He doesn't think gas will get to $4 per gallon this year.

"I think that could be something that happens as early as March of next year, but again with six months between now and then there is a lot that can change," he said.

Just last week, President Joe Biden's administration said they are considering using the strategic petroleum reserve to help lower prices. It has the capacity to hold 700 million barrels, which is around a 30-day reserve.

In the past, it had only been used when there was a dramatic shock to the system.