How Gas Prices In 2016 Compare To What You Pay In 2026

Unless you've been living under a rock or are lucky enough to reside in a walkable city, chances are you've noticed the skyrocketing gas prices recently. As of October 2026, places like California have stations well into the $7/gallon territory, with the average as of writing being $6.38 across the state. You can count on one hand the number of states with less than $4 a gallon on average, in fact, a trend that's been ongoing since President Trump declared war on Iran. Since March 2026, prices have climbed up an average of about 50 percent nationwide for gasoline and 90 percent for diesel, hitting a four-year high in May.

That said, it's hard to truly appreciate just how bad it's got (and how bad it's likely to get) without some historical context, so let's rewind to just a decade ago. Back then, the national average gas price was as low as $1.64 a gallon in February and as high as $2.34 in June, according to the U.S. Bureau of Labor Statistics and published on Macrotrends. Adjusted for inflation, that's a high of $3.26 a gallon for all of 2016. These numbers continued well into the COVID-19 pandemic, with a spike in 2022 attributed to embargoes from the Russian invasion of Ukraine marking the beginning of what perhaps may be a new Oil Crisis.

The price actually has little to do with the cost of oil per barrel, and we'll get into why and where all the money's actually going. Moreover, we can look at historical anecdotes for hints if this trend is likely to continue. Let's explore.

The major factor behind the current fuel crisis is the numerous ongoing wars throughout the Middle East and Asia — the Ukraine War, the Gaza genocide, and the Iran War in chronological order (pertinent to the post-COVID spike). But that's just a general brush stroke — the actual intricacies of how fuel prices are determined are more nuanced. First of all, you need to actually process and refine the oil into gasoline, then you need to transport it to the fuel pump. Then you factor in external costs like taxes, plus the operating costs of the logistics chain.

Basically, there is a correlation between the cost of oil per barrel and gasoline, but it's not a direct line. The United States is one part of a global logistical network, as the country both imports and exports various petroleum products en masse. As such, factors such as export limitations and tariffs, total domestic versus foreign crude oil production and storage, and supply versus demand create volatile price fluctuations nationwide, sometimes overnight.

For example, let's say the United States exports more oil to other countries, thereby increasing demand, but also satisfying global supply. The Energy Information Administration conducted such a study, concluding that it would lower global crude prices and open up demand for additional production of domestic petroleum. That's simply one scenario, of course, and it's by no means a given in today's international political climate. But it goes without saying that the more volatile geopolitics are, especially surrounding critical oil-producing countries, the less likely prices will go down because it's simply harder to refine and move the product.

To predict what the future of fuel prices will be, we have to first look back into history. Once upon a time in 1973, a similar situation occurred as a result of the Yom Kippur War, which led to the Organization of Arab Petroleum Exporting Countries (OPEC) placing a total oil embargo against countries that supported Israel. This shot up per-barrel oil prices nationwide by a factor of four and led to the 1973 Oil Crisis, punctuated by lines of cars outside fuel stations everywhere.

The 1973 and subsequent 1979 Oil Crises had a number of lasting implications on the automotive zeitgeist, which we call the Malaise Era. Manufacturers essentially went into panic mode, changing gears from high-powered but inefficient muscle cars to slim, fuel-efficient vehicles designed to counter the rise of the compact Japanese and European import market. Moreover, government restrictions on polluting emissions choked larger engines, significantly limiting power and effectively ending the muscle car.

While the Malaise Era is largely considered to have lasted until 1983, its reach extends all the way to today. Computer-assisted designs, aerodynamic profiles, the rise of the compact car, and more all came out of this time period. 2026 saw yet another meteoric spike in both price and demand for gasoline and diesel, which could very well lead to a second wave of these more compact, fuel-efficient, and alternative-fuel cars. In fact, we're already seeing many advances in EV development, such as solid-state batteries produced by BYD that could lead to better range and capacity.