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$3.20K
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In 2026 If average regular gas prices for Texas are strictly greater than X by Dec 31, 2026 according to AAA, the market resolves to Yes. Early close condition: If this event occurs, the market will close the following 10:15am, 11am, or 3pm ET. If this event occurs, the market will close the following 10:15am, 11am, or 3pm ET.
Prediction markets suggest it is very likely that the average price for a gallon of regular gasoline in Texas will stay below $2.70 through the end of 2026. The current probability is about 82%, which translates to a roughly 4 in 5 chance that prices remain under that threshold. This shows a strong consensus among traders that we will not see a sustained return to higher price levels over this two-year period.
Two main factors are likely driving this forecast. First, Texas is a major oil-producing state with local refineries, which typically helps keep retail fuel costs lower than the national average. The state's average price has frequently been among the lowest in the country. Second, broader energy market forecasts point to adequate global oil supplies and modest demand growth, which generally prevents the kind of supply shocks that cause prices to spike for long periods. While prices can jump after a hurricane or geopolitical event, markets are betting those spikes will be temporary and not lift the entire year's average above $2.70.
The market resolves based on the full-year 2026 average, so no single date will decide it. However, traders will watch a few recurring patterns. The summer driving season and the Atlantic hurricane season (June through November) can create temporary price increases if storms disrupt Gulf Coast refineries. Any major decisions from OPEC+ on oil production could also shift the underlying cost of crude oil, which is the biggest component of gas prices. A sustained conflict in a key oil-producing region could change the outlook, but the market's current odds suggest traders see these risks as manageable.
Prediction markets have a mixed record on long-term commodity prices, which are influenced by complex global forces. They are often better at aggregating short-term sentiment than forecasting years ahead. For a state-specific price like this, the prediction mainly reflects the current expectation of stable conditions. It is a useful snapshot of what informed traders believe today, but its accuracy will depend on unpredictable events like economic recessions, major policy changes, or unforeseen production disruptions over the next two years.
The prediction market on Kalshi shows high confidence that Texas gas prices will remain low through 2026. The leading contract, "Will average gas prices be above or below $2.70 by Dec 31, 2026?" is trading at 82% for the "Below" outcome. This price indicates traders see an overwhelming 82% probability that the statewide average for regular gasoline will stay under $2.70 per gallon at the end of 2026. Given that the AAA average price in Texas was approximately $3.00 in early 2024, this forecast implies a significant expectation of deflation at the pump over the next two and a half years.
Two primary economic forces are shaping this pessimistic outlook for fuel costs. First, the market is pricing in a sustained downturn in crude oil prices. Major forecasts, including those from the U.S. Energy Information Administration, project rising global oil production and inventories through 2025, which typically pressures prices downward. Second, the expansion of Texas's refining capacity and pipeline infrastructure increases regional fuel supply resilience. The state's direct access to the Permian Basin, one of the world's largest oil fields, buffers it from global supply shocks more effectively than other regions. Traders are betting that local production and refining advantages will keep retail margins compressed.
The current 82% probability for sub-$2.70 gas is vulnerable to geopolitical and policy shifts. An escalation of conflict in key oil-producing regions could disrupt global supply chains and send crude prices soaring. Domestically, federal environmental regulations could tighten refinery specifications or alter biofuel blending mandates, increasing production costs that would be passed to consumers. A major hurricane disrupting Gulf Coast refining operations, a perennial Texas risk, would cause immediate price spikes. The market's thin liquidity, with only $3,000 in volume, also means new information or a few large trades could shift the odds rapidly. The long timeframe to December 2026 leaves ample room for these variables to alter the trajectory.
AI-generated analysis based on market data. Not financial advice.
This prediction market focuses on whether the average price for regular gasoline in Texas will exceed a specific threshold by December 31, 2026. The market uses data from the American Automobile Association (AAA), a widely cited source for fuel price tracking. Gasoline prices are a significant economic indicator and household expense, influenced by a complex mix of global crude oil markets, regional refinery operations, state taxes, and seasonal demand patterns. In Texas, the price at the pump is particularly watched because the state is both a major energy producer and a large consumer with a car-dependent culture and vast distances between cities. Recent interest in Texas gas price forecasts stems from volatile energy markets following geopolitical events like the Russia-Ukraine war, OPEC+ production decisions, and domestic factors such as refinery outages and hurricane seasons in the Gulf Coast. The 2026 timeframe extends beyond typical short-term forecasts, requiring analysis of longer-term trends in electric vehicle adoption, federal energy policy, and infrastructure investments. Prediction markets on this topic aggregate collective intelligence about these uncertain future outcomes. AAA's Daily Fuel Gauge Report is the designated resolution source. It surveys credit card transactions from over 100,000 retail gasoline stations across the United States. The Texas average is calculated from stations within the state. The market includes an early close condition: if the price threshold is met before December 31, 2026, the market will close at the next designated time (10:15 AM, 11:00 AM, or 3:00 PM ET). This mechanism ensures the market resolves promptly once the outcome is determined.
Texas gasoline prices have experienced significant volatility over the past two decades. In July 2008, the statewide average reached a record high of $3.98 per gallon for regular, according to AAA data, driven by crude oil prices surging above $140 per barrel. Prices collapsed later that year during the global financial crisis, falling below $1.50 by December 2008. This established a pattern where Texas prices closely follow, but are typically 10-20 cents below, the national average due to the state's proximity to refineries and lower state taxes. The shale revolution, beginning around 2010, transformed Texas into the leading U.S. oil producer, but this did not fully insulate the state from global price swings. In 2017, Hurricane Harvey caused a dramatic price spike, with the Texas average jumping from $2.15 to $2.52 in a single week after the storm shut down nearly 30% of U.S. refining capacity located along the Gulf Coast. More recently, the COVID-19 pandemic caused prices to plummet in April 2020, with the Texas average hitting $1.60, as demand evaporated. The subsequent recovery saw prices surge past $3.00 in 2021 and reach new highs above $4.50 in June 2022 following Russia's invasion of Ukraine.
Gasoline prices are a direct input into the cost of living for millions of Texans. For households, higher fuel costs reduce disposable income and can force cuts in other spending areas. For businesses, especially in transportation, logistics, and agriculture, increased fuel expenses raise operational costs, which can lead to higher prices for goods and services across the economy. This contributes to broader inflationary pressures. The political ramifications are also significant. Elected officials, from the governor to members of Congress, often face public pressure when prices rise. High prices can influence policy debates over energy production, tax suspensions, and regulatory approaches. Socially, sustained high prices may accelerate shifts in consumer behavior, such as increased interest in fuel-efficient or electric vehicles, and impact patterns of travel and tourism within the large state.
As of late 2024, Texas gasoline prices are subject to typical seasonal declines after the summer driving season. However, underlying market conditions remain tense due to ongoing OPEC+ production cuts and geopolitical risks in major oil-producing regions. Domestic factors include the operational status of Gulf Coast refineries and the potential for hurricane-related disruptions. The Energy Information Administration's Short-Term Energy Outlook provides monthly forecasts, but projections for 2026 involve greater uncertainty regarding economic growth, electric vehicle penetration, and long-term energy policy.
The current average is available on AAA's Daily Fuel Gauge Report website. Prices fluctuate daily based on crude oil costs, refining, distribution, and local market competition.
Texas has lower state gasoline taxes, is located near major refineries on the Gulf Coast reducing transportation costs, and uses a different, cheaper fuel blend than California, which has stricter environmental regulations.
Crude oil is the primary raw material for gasoline, typically accounting for 50-60% of the pump price. When global crude oil prices rise or fall, gasoline prices generally follow in the same direction with a short lag.
AAA updates its Daily Fuel Gauge Report once per day, shortly after midnight Eastern Time. This update reflects the average price data from the previous calendar day.
Yes. Hurricanes in the Gulf of Mexico can disrupt oil production and, more significantly, force refineries along the Texas coast to shut down. This sudden reduction in supply often causes rapid and sharp increases in gasoline prices statewide.
Educational content is AI-generated and sourced from Wikipedia. It should not be considered financial advice.
4 markets tracked
No data available
| Market | Platform | Price |
|---|---|---|
Will average **gas prices** be above or below $2.70 by Dec 31, 2026? | Kalshi | 82% |
Will average **gas prices** be above or below $2.80 by Dec 31, 2026? | Kalshi | 73% |
Will average **gas prices** be above or below $2.90 by Dec 31, 2026? | Kalshi | 59% |
Will average **gas prices** be above or below $3.00 by Dec 31, 2026? | Kalshi | 47% |
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