A drop in oil prices has made gasoline cheaper just in time for the start of the summer road trip season.
The national average cost of a gallon was $3.47 Thursday, down 46 cents from its peak in early April. Some experts predicted it would dip to $3.30 by July 4, far from forecasts early in the year of $5 a gallon this summer.
AAA’s Independence Day Travel Forecast predicts a record 42.273 million Americans are expected to journey at least 50 miles from home Friday, June 29, through Wednesday, July 4. More than 35 million of them will travel by car.
Patrick DeHaan, senior petroleum analyst for GasBuddy.com, said a gallon of gas in the area “will likely be in the $3.35 to $3.50 range over the July 4 holiday.” But DeHaan hasn’t jumped on the bandwagon of even-lower price predictions.
“We’re still two weeks out.
“It wouldn’t be much of a shock to me if there was some refinery issue or a shutdown just before the holiday, causing prices to jump,” he said.
But the outlook is favorable for the downward trend to continue. A barrel of U.S. crude oil dipped below $80 Thursday for the first time since October — down from $106 in early May. The Schork energy-trading group said it could go to $74 a barrel.
Average price at the pump in the area Thursday was more than a nickel higher than the national average at $3.51, but down 20 cents from a week earlier, according to CincyGasPrices.com, a website that uses spotters to monitor local fuel prices.
The Meijer in Hamilton had the lowest reported price in the area at $3.49. The Speedway on Roosevelt in Middletown had the highest during the 24-hour period at $3.64, according to the website.
The previous record of July 4 travelers was 42.26 million in 2007, said Cindy Antrican, public information manager for AAA. Last year’s figure was 40.3 million, when the national average for a gallon of gas was $3.64. Only 29.8 million Americans traveled during the Independence Day holiday in 2009, as the recession settled in.
Travel staff at the Miami Valley AAA said Thursday that members planning to drive during the holiday had requested maps, reservations and information for destinations including Indianapolis (105 miles), Louisville (152 miles), Myrtle Beach, S.C. (504 miles), Charlotte, N.C. (457 miles), Destin, Fla. (766 miles) and Chicago (298 miles).
Those driving to Southern states, where fuel taxes are lower, will encounter gasoline prices that are flirting with the $3 level. South Carolina’s average price on Thursday was $3.01.
California’s gas prices have settled below $4 for the first time in months. The average price of a gallon has dropped 43 cents in a month to $3.88.
Antrican said AAA’s forecast shows 20 percent of motorists will start their holiday trips June 29, 16 percent will start on Saturday and 16 percent will start on Sunday.
“In our region, which includes Ohio, Michigan, Indiana, Illinois and Wisconsin, holiday travel by auto is expected to be up 4.3 percent. We didn’t see this over Memorial Day, but travel by air is also expected to climb 10 percent compared to a year ago,” she said.
DeHaan said abrupt changes in gas prices are most likely in the Great Lakes region, in part because of the dominance of Speedway.
“Their stations are corporate-owned, so they all raise their prices at one time and competitors follow. Speedway is also then able to lower prices first. It’s a bit of a cat-and-mouse game,” he said. “Price changes tend to be more gradual in other regions.”
He’s skeptical about some analysts’ predictions that prices could tumble below $3 a gallon before autumn, when demand typically drops. “That would be as extreme as the price jumping to between $4 and $4.50. Any forecast is a gamble, because it really depends on factors like the economic recovery, which has been way slower than expected, and the economic crisis in Greece, Italy and Spain. People having to settle for lousy jobs in this country and the devaluation of the Euro are causing prices to drop.”
He personally “won’t be burning much gasoline over the holiday. Chevy is sending me a Volt to try out. I’m in Chicagoland, and there are a lot of plug-in charging stations in the area,” he said.
Contact this reporter at (937) 225-2377 or terry.morris@coxinc.com.
Thank you for reading the Springfield News-Sun and for supporting local journalism. Subscribers: log in for access to your daily ePaper and premium newsletters.
Thank you for supporting in-depth local journalism with your subscription to the Springfield News-Sun. Get more news when you want it with email newsletters just for subscribers. Sign up here.