ADVERTISEMENT

ADVERTISEMENT

Motorists overlook high gas prices, plan to hit road for Memorial Day

Some 39 million people will travel 50 miles or more by car during the Memorial Day Weekend, up 8.3% from a year-ago and close to pre-pandemic volumes.

Gas prices in the U.S.
Gas prices over the $6 mark are advertised at a Mobil Station in Santa Monica, California, on May 23, 2022.
DAVID SWANSON/REUTERS
We are part of The Trust Project.

U.S. Memorial Day weekend travel is expected to be the busiest in two years as more American drivers hit the road and shake off coronavirus lock-ins despite high fuel prices.

The kickoff to the summer U.S. driving season may indicate just how much consumers are willing to tolerate fuel price increases. Miles traveled by motorists rose 5.6% in the first three months of the year even as the price of a gallon of regular gasoline has jumped 50% in the last year, to more than $4.59 on average nationally, according to the American Automobile Association.

"Americans just don't seem to be having a major reaction yet to the high price," said Patrick De Haan, head of petroleum analysis at price tracker GasBuddy, who says the nation could see $5-plus prices before long.

Ten states and the District of Columbia are already paying more than $5, with California's statewide average surging to more than $6 a gallon.

Some 39 million people will travel 50 miles or more by car during the Memorial Day Weekend, up 8.3% from a year-ago and close to pre-pandemic volumes, according to motorist group the American Automobile Association.

ADVERTISEMENT

'I'M GOING TO DRIVE'

In Barnstable, Mass., Dean DeLaHaye and wife Brigitte were preparing for a 250-mile round trip to New Hampshire to visit relatives.

"Most people are sick of staying home in the pandemic," said DeLaHaye, who refueled his Volkswagen Golf for the trip. "High prices have not affected us. I'm going to drive," he added.

Gasoline prices have surged on rising demand and tight energy supplies due to refinery closings and fewer imports after Russia's invasion of Ukraine. U.S. gasoline inventories have fallen for seven consecutive weeks, to 220.2 million barrels, the lowest since December, U.S. Energy Information Administration data showed.

Higher U.S. exports are also driving gasoline prices higher by reducing inventories. Demand from Europe and South America has U.S. motorists competing with consumers elsewhere, said John Kilduff, partner at commodities investment firm Again Capital.

"If exports persist at this elevated pace and refinery runs — already near the top of the range for reasonable utilization rates — fall within our expectations... retail gasoline prices could climb to $6 per gallon or even higher," said JPMorgan analysts.

Consumption of motor gasoline is set to hit 9.12 million barrels per day (bpd) this month, and reach a peak for this summer at 9.31 million bpd in July, according to EIA data.

Instead of driving less, U.S. consumers likely will look to cut costs elsewhere, such as by dining out less, said AAA spokesperson Devin Gladden.

(Reporting by Stephanie Kelly in New York, Arathy Somasekhar in Houston and Erwin Seba in League City, Texas; additional reporting by Julie Ingwersen in Chicago; editing by Cynthia Osterman.)

ADVERTISEMENT

______________________________________________________

This story was written by one of our partner news agencies. Forum Communications Company uses content from agencies such as Reuters, Kaiser Health News, Tribune News Service and others to provide a wider range of news to our readers. Learn more about the news services FCC uses here.

What to read next
After greeting top Democrats Nancy Pelosi and Chuck Schumer at the award ceremony held in the Capitol Building, Gladys and Ken Sicknick walked by McCarthy and McConnell without acknowledging them.
While the fine is not expected to be material for a company of the Trump Organization's size, the conviction by a jury could complicate its ability to do business by spooking lenders and partners.
The case has come to the Supreme Court at a time of heightened concern over U.S. election integrity in light of new voting restrictions pursued by Republican state legislatures.
Analysts say those votes likely tilted Democratic, which will require strong Election Day turnout by Walker's Republican supporters. Opinion polls have shown a narrow lead for Warnock.