The U.S. Energy Information Administration now expects gasoline to average $3.56 a gallon in 2027, up from the $3.35 it projected a month earlier. The increase comes in the agency’s October Short-Term Energy Outlook, released October 6, after regular gasoline averaged $4.35 a gallon across September.
The 2027 average would still sit 79 cents below September’s pump price. The outlook also lifts the 2026 gasoline forecast to $3.91 from $3.84, so the agency sees prices easing through next year, only more slowly than it did in September. The step down from the 2026 average to the 2027 average is 35 cents a gallon.
What moved between the September and October forecasts
The EIA’s September outlook had 2027 gasoline at $3.35 and 2026 at $3.84. The October numbers raise both: $3.56 for 2027, a 6.3% increase in the forecast, and $3.91 for 2026. The report attributes September’s rise in pump prices to higher crude oil prices and rising crack spreads, the gap between what refiners pay for crude and what they get for the gasoline made from it. The Brent increase for 2027 is $10 a barrel, and the 2027 gasoline forecast rose 21 cents, from $3.35 to $3.56.
Crude is where the revision starts. The agency now expects Brent crude, the global benchmark, to average $96 a barrel in 2026 and $84 in 2027, against $91 and $74 in the previous forecast. For the fourth quarter of 2026 it projects $105 a barrel, $14 higher than last month’s outlook.
Anyone budgeting a fixed income around driving, from a monthly pension check to Social Security deposits, is therefore looking at a year-over-year drop that is smaller than hoped for. A $3.56 average is still a forecast, not a pump price, and the national average hides large gaps between regions.
A 2027 gasoline average of $3.56 keeps fuel one of the larger moving parts in a household budget, and several benefit programs that offset living costs only pay out after an application. The Benefits Checklist scans 11 benefit programs and lists the 2026 income limits for each.
Get the 11-program checklist of cost-of-living help, with 2026 income limits →
Diesel, and what September’s $4.35 looked like
Diesel runs well above gasoline in the outlook. September diesel averaged $6.29 a gallon, and the EIA forecasts $5.19 for 2026 (previously $5.07) and $4.49 for 2027 (previously $4.40). Those revisions are 12 cents for 2026 and 9 cents for 2027, smaller than the gasoline changes but in the same direction. The 2027 diesel forecast sits 93 cents above the 2027 gasoline forecast, and September’s actual diesel average ran $1.94 above the month’s gasoline average.
The $4.35 September average was not a spike that has since faded. The EIA’s weekly retail price survey put regular gasoline at $4.354 on October 5. That week’s regional readings ranged from $3.911 on the Gulf Coast to $5.727 on the West Coast, with $4.147 on the East Coast, $4.109 in the Midwest and $4.417 in the Rocky Mountain states. The spread from the cheapest region to the most expensive was $1.816 a gallon, more than four times the 44-cent gap between the Gulf Coast price and the national average of $4.354. West Coast drivers were paying about $1.82 more per gallon than Gulf Coast drivers on the same day, a difference that no national average captures.
What a $3.56 average leaves out
The forecast rests on an assumption about the Middle East. The EIA writes that it assumes oil flows from the region “will remain constrained through the fourth quarter of 2026,” then expects convoys through the Strait of Hormuz and workarounds such as bypass routes and ship-to-ship transfers to lift production and exports through the rest of the forecast period. If that recovery arrives later than assumed, the 2027 number is the one that would move.
An annual average smooths over seasons. A year at $3.56 can include months well above it, particularly if crude prices run ahead of the $84 Brent forecast. The October outlook puts Brent at $105 a barrel in the fourth quarter of 2026 and $84 for all of 2027, a $21 drop from the fourth-quarter figure, even as the 2027 Brent forecast itself was raised $10 from last month. The EIA publishes its next full outlook on November 10, and the agency has shown within one month that it will revise the number when oil moves.
Tracking the pump price against the forecast
The simplest check on the forecast is the EIA’s weekly survey, which showed prices as of October 5 and is next due October 14. Comparing the local price with the national $4.354 shows how far a given region sits from the average, and the West Coast’s $5.727 shows how wide that gap can get.
The gap is easy to see: the September average of $4.35 is $0.79 above the 2027 forecast, so every gallon bought now costs more than the agency expects to be typical in a year. Keeping a monthly fuel total next to the weekly price makes it easier to tell whether a bill is rising because of price or because of miles.
The outlook’s own caveat is the Middle East assumption. Any news that oil flows through the Strait of Hormuz are recovering faster or slower than the fourth-quarter timeline would bear on the 2027 figure, and the next outlook will show by how much.
Fuel at $3.56 next year still needs a plan
Programs that ease energy and living costs for people 60 and older are opt-in, and the detail that trips people up is the income limit each one sets for 2026. The Benefits Checklist puts 11 benefit programs and the 2026 income limits in one guide, so the household can see which applications are worth starting before the next price revision lands.
Sort out which of 11 cost-easing programs fit a fixed budget with the Benefits Checklist →
This article was produced with AI assistance and reviewed by The Financial Wire’s editorial team.
Warren Cohen is a finance writer based in Phoenix, Arizona, covering personal finance topics including credit, banking, and beginner investing. He earned his degree in business administration from Arizona State University and began his career working in consumer finance, where he gained direct experience with lending and credit systems. He now writes for personal finance websites and fintech platforms, focusing on clear, practical content that helps readers make informed financial decisions.
