Low Retail Gas Prices Encourage Consumers to Travel this Summer
Around about Memorial Day weekend, gas prices began to steadily climb, increasing by 22 cents in just three weeks, but industry analysts suggest that the commodity has most likely peaked for the year. Retail prices often drop right around June as refineries finish up seasonal maintenance and switch to summer fuel grades, with prices declining by an average of 12 cents per gallon at this time over the last five years. The Energy Information Administration predicted the week of Memorial Day experienced the highest demand for gas since August 2007, and the lowered fuel prices are demonstrating the consumer’s desire to take more road trips during this season.
Other than refinery maintenance in June, the price of crude oil also plays a role in determining gasoline’s market performance. Production appears to be rallying in America as well as OPEC’s largest crude oil producing countries, including Iraq which has been receiving attention from engineering firms so that they can increase efficiency in Iraqi energy operations. Crude oil, being the key ingredient to gasoline, has evidently been stabilizing over the past few weeks which is leading industry experts to the conclusion that summer gas prices will be at their lowest since 2009.
Cheap gas has made smaller dents in consumers’ wallets, allowing them to take advantage of the $2.75 per gallon value and drive across the country for the summer vacation. Some have reported that it now only takes $40 to fill up their family cars, a stark contrast between their expenditure around this time last year when they had to pay $55. But not all consumers seem to be too happy with low gasoline prices. Tyler Morning Telegraph interviewed Ronald and Vivian Deshotels who were fueling up at a station along Interstate 20. Vivian expressed her concern for all the layoffs while Ronald added on why we need the higher prices, saying, “I like the high prices. It puts more rigs out there.”
Although history indicates that fuel prices will decline soon, gas can be just as unpredictable as oil. Prices could certainly rise this season due to factors such as prolonged fighting in the Middle East, hurricanes in the Atlantic, and unexpected interruptions in major gas refineries.