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Gas Prices: What Will It Cost to Fuel Up This Weekend?

Sheetz is dropping gas prices through Independence Day.

Sheetz gas station
Sheetz is offering Unleaded 88 for $3.99 through the end of the July 4 holiday.
SOPA Images/Getty Images

To "reduce pain at the pump," mid-Atlantic gas chain Sheetz has lowered the price on Unleaded 88 to $3.99 a gallon through the Fourth of July.

Open 24-7, Sheetz operates more than 650 locations throughout Pennsylvania, West Virginia, Virginia, Maryland, Ohio and North Carolina. Gas in Pennsylvania is averaging $4.95, saving motorists there almost a dollar a gallon. 

According to Sheetz, Unleaded 88 is approved for vehicles with the model year 2001 or newer, as well as light-duty trucks, SUVs and "flexible fuel vehicles," or FFVs. 

The convenience store chain is also slashing the price of E85 gas to $3.49, though the high-ethanol mix is not compatible with all vehicles.  

Read moreE85: Can Your Car Use the Cheaper Gas Alternative?

After circling $5 for more than a week, gas has dropped to $4.88 a gallon, according to AAA. Part of that is due to a decline in oil prices -- to about $107 per barrel, down from $110 last week. 

"Fear is not a good reason to move a market like the one for oil, but it is a powerful motivator," AAA spokesperson Andrew Gross said. "The cost of oil accounts for nearly $3 for every $4.89 at the gas pump."

But as summer is heating up, demand is only expected to increase. Especially over the three-day Independence Day weekend. GasBuddy analyst Patrick DeHaan predicts motorists will be paying $4.85 a gallon on average, the highest ever for July 4 but still nearly 20 cents lower than mid-June.

Here's what you need to know about gasoline prices, including how high they could go, what the White House is doing to turn that around and how you can save money when you fill up.

Why is gas so expensive?

Russia's ongoing invasion of Ukraine is one obvious factor. The price of gas is inextricably linked to the cost of crude oil, from which it's refined. Every $10 increase in the cost of a barrel of crude adds almost 25 cents to the price of a gallon of gas.

According to the White House, the war has raised gasoline prices by more than $1.70 per gallon.

Even though the US doesn't import much crude from Russia, oil is traded on a global market and any change affects prices all over the world. 

Gas prices on a sign at a station in Los Angeles country, with a car and a bus in the background

The average price of gasoline in California has hit $6.30 a gallon.

Zeng Hui/Getty Images

Crude oil prices could reach $150 a barrel by fall, Foreign Policy reported. And, according to new data from the Energy Information Administration, the total domestic supply of gasoline is falling: The week of July 13 it dropped 700,000 barrels to 217.5 trillion.

But the Russian invasion isn't the only factor: Even though demand is nearing pre-pandemic levels, producers are still gun-shy about increasing production. In April, OPEC fell short of its targeted production increase by 2.7 million barrels a day.

"We've had a supply-and-demand imbalance for a while," Troy Vincent, a senior market analyst at energy analysis firm DTN, told CNET. "And it will remain, regardless of whether this conflict goes away." 

President Joe Biden has also accused oil companies of profiteering off the crisis.

"Amid a war that has raised gasoline prices more than $1.70 per gallon, historically high refinery profit margins are worsening that pain," Biden wrote in a June 15 letter to heads of Exxon Mobil, Chevron, Shell, Phillips 66, BP and other companies. 

"I understand that many factors contributed to the business decisions to reduce refinery capacity, which occurred before I took office," he added. "But at a time of war, refinery profit margins well above normal being passed directly onto American families are not acceptable."

In addition, in the summer months, gasoline is reformulated to prevent excess evaporation caused by higher temperatures outside. The more expensive summer blend of gasoline can add between 7 and 10 cents per gallon.

How high will gas prices go?

The week of June 13, gas hit an average of $5.02 a gallon -- a record dollar amount but, adjusted for inflation, still below the 2008 peak of $4.14, which would be about $5.37 now. 

Still, experts don't believe we've seen the end of rising gas prices.  

Analysts predict prices at the pump will go up again. According to Ed Hirs, an economist at the University of Houston, the national average will likely hit $6 a gallon by Labor Day.

Natasha Kaneva, JPMorgan's head of commodities research, is even more pessimistic: In a May report, Kaneva said the price could jump to $6.20 a gallon as early as August, Insider reported

gas prices

Analysts predict gas in the US could surpass $6 a gallon nationwide by fall.

Getty Images

What is the government doing to lower gas prices? 

In June, President Biden endorsed a three-month nationwide gas tax holiday. Individually, Connecticut, Maryland, New York, Florida and Georgia have already suspended state gas taxes, and at least 20 other states are considering similar moves. 

In the June 15 letter, Biden called on oil companies to work with his administration to address any reductions in production as well as "inventory, price, and refining capacity issues." 

He previously criticized them for sitting on over 12 million acres of federal land approved for drilling and 9,000 production permits. The administration has indicated it wants oil companies to pay fines for letting leases go unused.

In April, the Environmental Protection Agency approved year-round sales of E15 gasoline, a cheaper, higher-ethanol fuel. The impact will be modest, as only about 2,500 of the more than 100,000 gas stations nationwide sell the blend.

In March, the White House began releasing a million barrels of oil a day from the US Strategic Petroleum Reserve. The unprecedented withdrawal, expected to last for six months, could lower gasoline prices between 10 and 35 cents a gallon.

"It will lower the oil price a little and encourage more demand. But it is still a Band-Aid on a significant shortfall of supply,"  Scott Sheffield, chief executive of Texas oil company Pioneer Natural Resources, told The New York Times.

The US is also looking at getting energy products from other sources: The Biden administration has been improving diplomatic relations with Venezuela, which has been banned from selling oil to the US since 2018 and is negotiating another nuclear nonproliferation treaty with Iran, which could bring Iranian oil back onto the market.

How can drivers save at the pump?

Drivers can cut down on nonessential trips and shop around for the best price, even crossing state lines if convenient. 

Apps like Gas Guru scan for the best gas prices in your region. Others, like FuelLog, track your car's gas mileage and can help determine if it's getting decent fuel economy. In addition, many gas station chains have loyalty programs, and credit cards have rewards programs that give cash back for gas purchases.

DTN's Vincent advises against hoarding gas or other extreme measures but encourages budgeting more for gas. High energy prices have been a major contributor to inflation for a while, he said, and won't be going away immediately. 

"When the cost of crude rises, prices at the pump tend to reflect it very quickly," he said. "But gas prices tend to linger higher longer even when crude falls."