This oil rebound will impact Texas gas prices significantly. During the oil production war this year, Texas drivers enjoyed some of the lowest oil prices in years. Regular unleaded gas prices in Texas averaged around $1.51 per gallon. Since the oil market has begun to rebound, this price has increased to $1.65 per gallon as of June 1st. This is still lower than the national average of $1.93 per gallon, but the increase in gas prices is still noticeable. This recovery in oil prices will continue and $2 per gallon likely will be common across Texas in the next few weeks.
Although these prices will continue to increase in the short-term, they is still much lower than the gas prices at this time last year. On June 1st, 2019, the state average for gas prices was $2.49 per gallon.
AAA Texas spokesperson Daniel Armbruster explained, “However, the pandemic still has caused demand levels to sink much lower than in recent history.” It is expected that both oil prices and oil demand will continue to increase week over week until average consumption levels have returned.
The Energy Information Administration (EIA) predicts that the price of gas nationwide will continue to increase for the remainder of 2020. This is largely due to the production of oil and gas declining by major producers like the United States, Saudi Arabia and Russia.
OPEC and Russia have agreed to a deal that will continue through the 2021 calendar year, so oil and gas production will decrease and prices will continue to increase during that period. The EIA anticipates that the price for crude oil at the beginning of 2021 will be approximately $43 per barrel.
For Texas residents, this will mean gas prices will continue to increase and could approach $3 per gallon over the next 18 months. Although these prices are much higher than current prices, Texas will still have some of the lowest gas prices in the country.
Dhoof Mohamed writes about energy and IT topics for various clients. His academic interests include solar energy initiatives and the future of sustainable energy. His articles have appeared on SiteProNews, ChooseFlorida and the office of the U.S. Embassy. You can reach him at firstname.lastname@example.org.