Petroleum products

U.S. gasoline and diesel prices
Lower crude oil prices will continue to push down retail gasoline and diesel prices in the United States in 2026. We forecast the average U.S. retail gasoline price to remain near $3.00 per gallon (gal) for the remainder of 2025, resulting in an average 2025 price of $3.10/gal, a 6% decrease from 2024. In 2026, we forecast the average retail gasoline price to fall by 4% to just under $3.00/gal, which would be the lowest annual average price since 2020. We forecast the U.S. retail diesel price will average almost $3.70/gal in 2025, down 3% from 2024. Diesel prices are forecast to fall by another 4% in 2026. As with gasoline, lower diesel prices are primarily a result of lower crude oil prices. We expect the Brent crude oil price will average $69 per barrel (b) this year, down from $81/b in 2024, and we forecast it will fall to an average of $55/b in 2026.

Crude oil is the largest component of retail gasoline and diesel prices, typically accounting for about half of the total price per gallon. As crude oil prices fall, the portion of retail fuel prices attributable to crude oil also falls. For retail gasoline, crude oil is expected to make up 53% of the price in 2025 and 44% in 2026.

Similarly, for diesel, crude oil’s contribution to the retail price is forecast to be 45% in 2025 and 37% in 2026. If the 2026 forecast for diesel is realized, it would be the lowest crude oil contribution to retail diesel prices since 1998.

However, falling crude oil prices do not lead to a proportional drop in prices at the pump because the effect of lower crude oil costs is partly offset by rising crack spreads. A crack spread is the difference between wholesale petroleum product prices and crude oil prices, broadly serving as a measure of refiners’ profit margins. Rising crack spreads can dampen the impact of falling crude oil prices for consumers.

We forecast diesel crack spreads to rise from an average of $0.52/gal in 2024 to $0.69/gal in 2025, reaching $0.84/gal in 2026. In the gasoline market, we similarly forecast strong crack spread gains for 2025 and 2026.

We forecast all regional gasoline prices in the United States will average less than $3.00/gal in 2026 except for on the West Coast, where the forecast annual average price is $4.10/gal. The West Coast—which usually has the highest retail fuel cost in the country—faces additional price pressure in the coming years due to reduced refinery capacity stemming from two planned refinery closures: Phillips 66’s Wilmington refinery in the Los Angeles area this year and Valero’s Benicia refinery in the Bay Area in April 2026.