With spring in the air and summer right around the corner, cheaper year-over-year gasoline prices are giving more Americans the “fuel” they need to take a road trip. According to AAA’s latest Gas Price survey, 1 in 3 Americans (33 percent) said they would likely plan another summer road trip if prices remain lower than years past, while 27 percent say they would increase the distance of one – with Generation X more likely than Baby Boomers to do both.
In addition to increasing the number or mileage of summer road trips, the AAA survey of U.S. adults found:
47 percent would put aside more money for savings.
33 percent would go on at least one additional summer road trip.
27 percent would increase the distance of a summer road trip.
20 percent would increase shopping of dining out.
20 percent would drive more on a weekly basis.
16 percent would make major purchases.
14 percent would use a less fuel-efficient vehicle.
9 percent would use more expensive gas.
“Even though gasoline has been trending upward as 2019 has progressed, cheaper crude oil prices have helped to keep pump prices lower compared to last year,” said Bevi Powell, senior vice president, AAA East Central. “With prices expected to be mostly on-par with last summer, we are excited to see more Americans saying they may plan an extra trip this summer, or even extend the trips they already have planned with their families and friends.”
Potential Price Influences
Motorists benefited this winter from lower crude prices, which comprises approximately 50 percent of the prices paid at the pump. Crude prices ranged between $48 and $56 this winter, while winter 2018 saw consistent prices between $60 and $65. This difference helped to keep pump prices mostly cheaper this winter, but crude prices could be poised to increase this spring, which would propel gas prices higher as gasoline demand increases across the country.
Moving into spring, crude prices could increase as the Organization of the Petroleum Exporting Countries (OPEC) continues to implement its agreement with other global crude producers to cut production by 1.2 million barrels-per-day, which remains in effect through June. OPEC has announced that it will not meet in April to discuss the pact; instead, it will meet on June 25 and 26 and may announce a decision to end or extend its agreement at that time. OPEC and its partners will likely look toward global pricing trends around the time the cuts are set to expire as well as global crude demand forecasts, and how well members of the reduction pact have adhered to the production cuts to determine if it should extend its pact beyond June.
Aside from global and domestic oil dynamics, gasoline historically trends upward during the early springtime and summer months as demand increases and the nation switches to producing and selling summer-blend gasoline. The difference between summer- and winter-blend gasoline involves the Reid Vapor Pressure (RVP) of the fuel, which measures how easily the fuel evaporates at a given temperature. The more volatile a gasoline (higher RVP), the easier it evaporates. Summer-blend gasoline has a lower RVP to prevent excessive evaporation when outside temperatures rise. Reducing the volatility of summer gas also decreases emissions, and can help prevent drivability problems, especially in older vehicles. Summer-blend is more expensive to produce, and that cost is passed on to the consumer each spring.
AAA East Central is a not-for-profit association with 80 local offices in Kentucky, New York, Ohio, Pennsylvania and West Virginia serving 2.7 million members. Past news releases are available at news.eastcentral.aaa.com. Follow us on Twitter and Facebook.