Here's a forecast Western Washington residents haven't seen in a while - gasoline prices might go down in 2014.
That's the outlook from GasBuddy.com in its annual fuel price study. This area will still have price spikes, particularly in the first half of the year, but the second half of 2014 could see some price drops than were last seen in 2010, said Tom Kloza, a chief oil analyst for GasBuddy.com.
The reason for the potential drop in gas prices is that supply is catching up to demand, with Washington state being one of the beneficiaries of the U.S. shale oil boom. The increase in oil production from such places as North Dakota comes at a time when Alaska crude production continues to decrease.
"The Puget Sound area is going through an interesting transition as the refineries get more oil shipped in from the Midwest," Kloza said. "For years we've had uncertainty of supply, now we have a period where the uncertainty is in demand."
GasBuddy.com predicts the average price range for a gallon of gas in Washington will be between $3.40 and $3.65, with peaks hitting between $3.85 and $3.99.
Across the U.S., GasBuddy.com's forecast is for prices to fall about 10 cents compared to 2013, pushing the average price below $3.40 a gallon. If that happens, it would be the lowest average since 2010. However, the study indicates prices will fluctuate quite a bit during the year.
In its own study, AAA expects only a slight decrease in prices as refineries across the U.S. expand production capacity and increasingly rely on North American crude oil.
The West Coast remains more at risk for events that could derail price drops because refineries here haven't done much to increase capacity. As in recent years, if a refinery unexpectedly shuts down, prices from Washington to California will jump, Kloza said. However with the U.S. producing more of its own crude oil, the country should become more insulated from price hikes for foreign crude oil, according to the GasBuddy study.
As for Bellingham, it is expected to continue the trend of having the highest gas prices among major metro areas in the state, with prices peaking around May or June. As of Tuesday, Dec. 31, the average price for a gallon of gas here was $3.50, with Seattle the next highest at $3.43.
At $3.10 a gallon, Spokane had the lowest average price in Washington metro areas at the end of 2013.
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