Surging USA Gasoline Demand Could Keep Pump Prices High

Surging gasoline demand may limit the success of the Biden Administration’s efforts to nudge pump prices much lower.

The four-week average of U.S. gasoline demand rose to 9.14 million barrels per day last week, data from the Energy Information Administration show. That’s the highest for this time of year since 2015 and suggests concerns about the omicron variant of the coronavirus have yet to stop Americans from hitting the road.

Gasoline prices in the U.S. have fallen by 10 cents per gallon since early November, when they hit a seven-year high. That triggered a series of reactionary measures from the Biden Administration, including dipping into the country’s emergency crude stockpiles. Even as oil prices have come off their recent highs, pump prices are still nearly $1 per gallon above seasonal norms.

Demand is expected to remain high in the short term. More than 100 million people are expected to get on the road this holiday season, according to auto club AAA. Meanwhile, supplies are set to tighten further with slower imports from Europe and below-average refinery operations.