It’s coming this summer – maybe even sooner. No, we’re not talking about the latest superhero adventure or popcorn flick to hit theaters this year (though there will be plenty of those, it seems). We’re talking about the dreaded $3 a gallon prices for gasoline – just in time for the summer driving season.
According to AAA, as of late April, the national average for unleaded gasoline was $2.73 a gallon, yet many states are already seeing prices soar to near or above the $3 mark. That’s about a 20 cent increase from what gas prices were at in March of this year, and about a 33 cent increase from what they were a year ago at this time.
So, just what are the factors behind the somewhat sudden increase in gas prices? It’s simple economics: supply and demand. According to market experts, gasoline demand was 9.86 million barrels one week in mid-April, a new record high. In fact, experts are surprised that this record was eclipsed before the Memorial Day holiday, a long weekend where many Americans tend to get away. For reference, the previous record high when it comes to gasoline demand was 9.8 million, set in one week last summer.
With the demand for oil going up, experts think that America could hit anywhere from $2.80 to $2.90 per gallon as a national average this summer – and it’s expected that these prices will stick around throughout the summer driving season until fall. If so, this would be the highest gas prices have reached in about four years.
Aside from demand, it’s believed that there are a few other notable factors impacting the rising costs of fuel. Low unemployment, for instance, directly translates to more people driving to get to work. It’s believed that the tax cuts signed into law in late 2017 are encouraging Americans to travel more. There’s also the fact that Americans love their SUVs, which don’t score as well in fuel economy as sedans and traditional cars.
The good news about these rising gas prices is that they’re mainly the result of a strong economy. And when you consider that gas prices peaked 10 years ago with a national average at $4.11 per gallon, $3 a gallon certainly doesn’t sound so bad. Even so, however, it’s only natural for Americans to want to save at the pump and increase their disposable income. Contrary to what many believe, you don’t need to drive a hybrid or gas-sipping vehicle to achieve this savings.
Here’s a look at some simple ways to improve your vehicle’s fuel economy now:
Look around: Download the GasBuddy app or visit GasBuddy.com to see a real-time list of the various prices on gas in your area. This can help you learn who is offering the cheapest gas.
Lightweight your car: Are you driving around with golf clubs and other sports equipment in your trunk? What about work stuff? Anything that makes your vehicle heavier is also making it work harder, thereby impacting your fuel economy. The lighter your car, the better your fuel economy.
Keep up on maintenance: Dirty air filters, old oil and more can negatively impact fuel economy. Even the most basic maintenance can make a difference, so don’t put off those oil changes, tire rotations and tune-ups. Make sure your tire pressure is at the manufacturer’s recommended PSI levels too.
Curb aggressive driving: We get that everyone is in a hurry these days, but fast acceleration and hard braking are two fuel economy killers when it comes to aggressive driving. Take your time and gradually accelerate from stopped positions, and try to avoid slamming the brakes.
Slow down: Here’s a surprising fact: Per the Department of Energy, every 5 miles per hour over 50 miles per hour that you’re driving at is like paying up to 20 cents more per gallon at the pump. Yes, driving at the speed limit can put money back into your pocket.
Use cruise control: On a summer road trip? Make sure you’re using the cruise control, which can yield a savings of up to 14 percent on fuel economy.
Regards,
Ethan Warrick
Editor
Wealth Authority
