Gas prices could be impacting U.S. travel plans

The average price for gas this coming long holiday weekend in the United States is about 50 cents more per gallon than the average over the last three years.
By Daniel J. Graeber Follow @dan_graeber Contact the Author   |  May 22, 2018 at 7:21 AM
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May 22 (UPI) -- Gas prices this coming Memorial Day weekend will be the highest in four years and likely start to dent the summer travel season, industry experts said.

Motor club AAA reported a national average retail price of $2.93 for a gallon of regular unleaded gasoline on Tuesday, up 17.5 cents from one month ago. By AAA's account, the average price leading up to the long holiday weekend is almost 50 cents more than the average for the last three Memorial Day weekends.

"Trends are indicating that this summer is likely to bring the national average to at least $3 per gallon," AAA spokeswoman Jeanette Casselano said in a statement.

Gas prices usually follow the price for crude oil. With a political standoff underway between the United States and Iran, a member of the Organization of Petroleum Exporting Countries, oil prices have moved sharply higher since the beginning of the month.

Since May 1, the price for Brent crude oil is up about 5 percent. Federal data show consumers, meanwhile, are seeing inflation at the gas pump more than many other goods.

Patrick DeHaan, the senior petroleum analyst at GasBuddy, said he was expecting summer travel plans will take a backseat as consumers face tough choices about their spending.

"High gas prices are starting to eat away at the travel plans of many, and the number will likely rise as gasoline prices appear poised to continue moving higher in the weeks ahead," he said in a separate statement.

AAA, however, said it expects nearly 37 million travelers will hit the road for the long holiday weekend, compared with the 34 million forecast for the same weekend last year. The national average price for a gallon of gas at this time last year was $2.35.

By region, the West Coast is the most expensive market in the country, with all of the states in the region posting an average price above $3 per gallon. Arizona, which up until now was below the psychological threshold, is now in the top 10 when it comes to the largest year-on-year increase with 70 cents per gallon.

Gasoline inventories in the region are higher than last year.

The Great Lakes market, meanwhile, is the most volatile, with most states reporting spikes of around 9 cents per gallon. Illinois is close behind Arizona with a price jump of 65 cents per gallon compared to last year.

Gasoline inventories in this region have been on the decline for the last two months.

Summer prices at the pump are higher than during the winter in part because the type of gasoline made for warmer months is more expensive to make.

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