In EIA's January Short-Term Energy Outlook, EIA now forecasts U.S. retail gasoline prices through the end of 2026.
EIA estimates U.S. average gasoline prices in 2025 will decrease by 11 cents per gallon (gal), or about 3%, compared with 2024. In 2026, EIA forecasts a further decrease of about 18 cents/gal, or an additional 6%. The lower U.S. gasoline prices are primarily a result of lower crude oil prices, as well as decreasing gasoline consumption in 2026 because of increasing fleetwide fuel economy.
U.S. retail gasoline prices to decrease in 2025 and 2026 with lower crude oil price
Data source: U.S. Energy Information Administration, Short-Term Energy Outlook (STEO)
Decreasing U.S. refinery capacity over the forecast period may offset some of the downward pressure of lower crude oil prices on gasoline prices.
EIA's forecast for decreasing U.S. retail gasoline prices over the next two years follows the decrease from 2023 to 2024, after retail prices surged in 2022. EIA estimates the gasoline price decreases in 2025 and 2026 will be smaller than the decrease between 2022 and 2023, when prices fell 11%.
The smaller scale of the price decreases over the next two years is primarily because, although crude oil prices fall, that effect is offset somewhat by an increase in refinery margins. In 2023 and 2024, annualized gasoline prices decreased because both crude oil prices decreased and refinery margins narrowed. In 2025 and 2026, EIA expects lower gasoline prices will only be driven by lower crude oil prices.
U.S. retail gasoline prices to decrease in 2025 and 2026 with lower crude oil price
Data source: U.S. Energy Information Administration, Short-Term Energy Outlook
Note: Crude oil is the Brent crude oil price, crack spread is the wholesale gasoline price minus the crude oil price, and distribution and tax margin is the average regular grade retail price minus the wholesale gasoline price.
In 2025, EIA expects crack spreads for gasoline—the difference between wholesale gasoline prices and crude oil prices that EIA uses as an estimation of refinery margins—will be wider than they were in 2024. This expectation reflects EIA's forecast for reduced U.S. refinery capacity next year compared with last year. Although wider than in 2024, EIA still estimates that crack spreads will be narrower in 2025 than in 2023 or 2022.
EIA's forecast for 2025 reflects the expectation for a small increase in U.S. gasoline consumption this year and increased net imports (imports minus exports) of motor gasoline to offset less refinery production of gasoline because of the expected closure of LyondellBasell’s Houston refinery in the first quarter. In 2026, EIA expects gasoline consumption to decrease relative to 2025 due to rising vehicle fleet efficiency. The increasing fleet efficiency reflects both an increasing share of electric vehicles in the U.S. passenger vehicle fleet, as well as increasing fuel economy in cars with conventional internal combustion engines. EIA expects refinery production will also decrease in 2026 in response to the planned closure of Phillips 66’s Los Angeles refinery at the end of 2025, contributing to further increases in net imports.
On a regional basis, EIA expects gasoline prices to decrease in every U.S. PADD region in 2025 except the Rocky Mountains. The Rocky Mountain prices effectively remain flat in 2025 because of steady regional population growth, contributing to increasing gasoline consumption, while constrained regional production and transportation infrastructure limits the ability to increase gasoline supply in response.
In 2026, EIA expects prices to decrease on the East Coast and Gulf Coast, as well as in the Midwest and Rocky Mountains, but expects them to increase on the West Coast. On the West Coast, EIA expects limited increases in consumption but reduced regional production in 2026 because of the Phillips 66 refinery closure.