Gasoline prices are moving higher as Memorial Day weekend nears, but American travelers on this holiday will still save almost a dollar a gallon compared with 2014.
The steep decline in oil and gas prices which occurred last autumn and winter is saving the average American approximately $650 this year, announced the Energy Department, but the trend has lost some of its strength in recent weeks. Retail gas expenses are up by almost a third since January, after an even larger regain in crude oil prices both at home and abroad.
Experts predict Americans will travel in large numbers to profit from fuel prices that stay lower than those of recent years.
The AAA motor club expects that 37.2 million Americans will hit the road on more than 50 miles distances this weekend, which is a 4.7 percent raise from last year and the largest number for the holiday in a decade. Of those travelers, almost 33 million will drive, a 5.3 percent spike over last year, the club announced.
“A strong employment market and low gas prices have driven consumer optimism to new highs and boosted Americans’ disposable income,” explained Marshall L. Doney, AAA’s president.
So far this year, retailers, hotels and restaurants have not benefited from the increased consumer spending resulted from low energy costs that most economists had predicted.
Economists announced they observed more benefits to the economy due to lower fuel costs in the last quarter of 2014 than in the first of 2015 for reasons that are still unknown.
“The bang from the lower gasoline prices did not come out as expected in the first quarter,” mentioned Mine K. Yucel, senior vice president and director of research at the Federal Reserve Bank of Dallas.
How much of an increase will come in the second quarter remains to be seen. Gasoline prices in most states have increased to their highest level since November 2014, when energy prices plummeted after an OPEC discussion in which Saudi Arabia and its allies announced they were against reducing production despite a growing global oversupply of crude oil.
Surveys revealed that gas prices have grown over the last month in all regions of the country. California and several other Midwestern and Western states noticed an increase because of various refinery problems. In Southern California, Exxon Mobil’s Torrance refinery is producing well below its capacity since a disastrous fire in February, even though repairs should be finished by the July 4 weekend.
Image Source: World Wide Weird News