An Artic blast of cold weather is here. The big question is: will it lead to higher or lower gasoline prices? 

On one hand, bitter cold and winter precipitation in the forecast tend to diminish gasoline demand as people park their cars and hunker down at home. Despite a modest uptick in demand last week, according to the Energy Information Administration, overall demand has been comparatively weak this winter. This has helped boost regional inventories of oil and gasoline and driven steady price declines since autumn.

 But extreme cold—much like extreme heat—can impact gasoline production. With record low temperatures across a large swath of the United States this week, oil and gas markets are anticipating the potential for reduced production caused by the cold. At the same time, oil prices can rise as Americans crank their thermostats, which puts upward pressure on gas prices.

Rhode Island’s average gas price is down two cents from last week, averaging $3.04 per gallon. Monday’s price was 14 cents lower than a month ago, and 20 cents lower than Jan. 15, 2023. Rhode Island’s average is two cents lower than the national average.

 “The national average for a gallon of gas is very close to a flat $3 a gallon and we’re not far behind here in the Northeast,” said Mark Schieldrop, Senior Spokesperson for AAA Northeast. “But prices might waffle a bit on weather-related concerns and the potential for escalating tensions in the Middle East, which so far, have not had a lasting impact on oil prices.”