AAA: Gas prices highest ever at Christmas
The cost of gas is the lump of coal in motorists’ Christmas stockings this year, and although pump prices have declined of recent, consumers will still end up paying the highest ever price for gas at Christmas in history. The national average for regular grade dropped 4 cents from last week to $3.25 per gallon Friday. Prices are 15 cents below month ago prices. Just before Christmas 2010, the average price was $2.98 (27 cents lower) and $2.59 (66 cents lower) per gallon two Christmases ago in 2009.
Crude oil plunged to its lowest level in six weeks this week as industrial production declined for the first time since April in the U.S., the world’s largest oil-consuming country, and the strength of the U.S. dollar against the euro as the euro region’s ability to manage its debt troubles mounted. A strong U.S. dollar will suppress crude oil prices. Prices are down 5.3 percent since December 9, heading for a second weekly decline and the biggest since September 23. Crude is 3.1 percent higher this year after climbing 15 percent in 2010. Some analysts cautioned there could be further losses in store for crude, which would help to push gas prices further down. Crude oil closed down for the second straight week at $93.53 Friday.
The U.S. Energy Information Administration’s (EIA) weekly report showed crude stocks dropped 1.9 million barrels to 334.2 million barrels. Gasoline stocks rose 3.8 million barrels to 218.8 million barrels. Gasoline demand slipped 8.666 million barrels per day (bpd), representing a year-over-year drop of 683,000 bpd from 2010 or 7.3 percent. Total petroleum demand last week was measured at 18.4 million bpd, down by a stunning 1.8 million bpd from the same week last year. The four-week average petroleum demand level is down 5.6 percent from last year, thanks to a 4.5 percent drop in domestic gasoline consumption; a 14.3 percent plunge in residual fuel; and an 18.7 percent drop in the other oils category.
“Gas prices continue to decline with less than a week until the start of the year-end holiday travel period, which is welcome news for motorists planning to take to the roadways,” said Martha M. Meade, Manager of Public and Government Affairs for AAA Mid-Atlantic. “Yet despite recent declines, motorists will be paying the highest ever gas prices at Christmas. However that doesn’t seem to be deterring over 83 million Americans (91 percent of holiday travelers) who plan to take to the roadways in the coming weeks.”
AAA forecasts 91.9 million Americans will travel 50 miles or more from home during the 2011-12 Year-End holiday travel season, a 1.4 percent increase over the 90.7 million people who traveled one year ago. This year’s expected Year-End holiday travel volume is the second highest in the past decade and represents 30 percent of the total U.S. population. Approximately 83.6 million people (91 percent of holiday travelers) plan to take to the nation’s roadways this Year-End holiday travel season, a 2.1 percent increase compared to 2010-11 when the number of auto travelers totaled 81.9 million. This year’s projected automobile travel volume is the second highest in the past decade and only 100,000 less than the 2006-07 auto travel peak of 83.7 million. Automobile travel remains the preferred choice of transportation for 2011-12 Year-End holiday travelers as nearly 27 percent of the total U.S. population will hit the road.