Rising gasoline prices risk diminishing the advantages of increased tax refunds under President Donald Trump’s tax legislation, according to analysts and economists. Brent crude futures climbed to nearly $112 per barrel on Thursday, while WTI crude oil futures rose 3.23% to $99.52 per barrel as of 12:25 PM ET. The national average gas price stands at $3.88 per gallon, based on AAA data.
Fuel Costs Outpacing Tax Relief Gains
Gas prices have surged 21.2% year-over-year as of March 16, per the EIA, adding $6.3 billion to monthly consumer spending. Total tax refunds for 2026 are projected to increase by $31–33 billion, or 9.4–10% year-over-year—equivalent to about one month of typical national gasoline expenditures.
John Mercer, Head of Global Research at Coresight Research, notes that while refunds provide a short-term buffer, they fail to fully offset elevated fuel expenses. These refunds could cover just over five months of the additional monthly gas burden. A more dramatic spike, such as the 44% year-over-year increase during the early weeks of Russia’s invasion of Ukraine, would reduce that coverage to roughly 2.3 months.
Impact on Households
Analysts estimate the average household faces an extra $740 in annual gas costs, potentially erasing—and sometimes surpassing—projected per-household refunds of $360 (IRS), $534 (Morgan Stanley), or $748 (Tax Foundation). Non-drivers and electric vehicle owners remain insulated from these pressures.
Outlook for Lower Prices
Energy Secretary Chris Wright presented a brighter view on Sunday during an appearance on NBC’s Meet the Press, indicating that gas prices could drop below $3 per gallon by summer.
