Jane Van Ryan
Posted May 28, 2010
The Memorial Day weekend traditionally is considered the beginning of the summer driving season, and this weekend travelers will receive a nice surprise at the pump.
API's Chief Economist John Felmy says gasoline prices have fallen 18.0 cents in the past three weeks, following a drop in crude oil prices. According to AAA, U.S. gasoline prices today average $2.749 a gallon, down from a recent peak of $2.929 on May 5.
The price of crude oil is the single largest factor in pump prices. The U.S. Energy Information Administration says crude oil accounts for about 69 percent of the pump price. Yesterday, the price of crude oil stood at $74.55 a barrel, which is significantly lower than the recent peak of $86.19 a barrel on May 3. The Philadelphia Inquirer reports crude prices have declined due to the "strengthening dollar, the Greek economic crisis, fluctuations in the stock market."
API data show U.S. gasoline supplies are ample. They are higher than last year's levels and above the five-year average. Likewise, gasoline production in recent months has reached new records. API statistics also show demand for gasoline is up 0.6 percent over the same date last year.
AAA projects that 5.4 percent more people will travel this three-day weekend, marking the first increase in Memorial Day travel since 2005. If you are planning to be on the road, be sure to wear your seatbelt and drive defensively. Safe travels!
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