Fuel prices hit 7-year high, car rental, and airfare prices also on the rise as 44 million Americans take to the road over the holiday weekend
As Americans hit the roads for the July 4 holiday weekend, filling their tanks is going to put a large dent in their holiday funds. According to the American Automobile Association, the cost of gas prices is hovering at around $3.09 per gallon on average nationally. GasBuddy has the figure slightly higher at $3.11 per gallon.
The AAA figures show that around 90% of gas stations across the states were charging $2.75 or more per gallon of regular unleaded in the run-up to the holiday weekend. Jeanette McGee, of the AAA, said – “That is a stark increase over last July 4 when only a quarter of stations were selling gas for more than $2.25.”
She added that most Americans were aware of the record gas prices before they hit the road, noting that many will look for more free activities and eat out less as a result of the increase, but are unlikely to drop their vacation plans.
According to GasBuddy, another problem could be the physical supply of gas. Gas stations across the nation will be gearing up for the weekend by filling their tanks. However, although there isn’t a shortage of Gas, there is a shortage of truck drivers. Many truck drivers were forced to leave their jobs at the height of the pandemic as there wasn’t a demand for their services. Many of these posts remain unfilled even although the pandemic has eased and demand is returning.
GasBuddy did add that there was no need for travelers to panic, saying that – “We are seeing delays in gasoline being delivered at a very few stations, but there isn’t much rhyme or reason to the locations. If you see a station with bagged pumps, they’ll likely have gas in a few hours again, just try the next station.”
A more pessimistic view was put forward by Tom Loza, head of energy analysis at the Oil Price Information Service. Interviewed by CNN he said – “It used to be an afterthought for station owners to schedule truck deliveries. Now it’s job number one. What I’m worried about for July is the increased demand works out to about 2,500 to 3,000 more deliveries needed every day. There just aren’t the drivers to do that.”
Car Rentals and Airfares Follow Suit
The cost of car rental has also soared as the holiday’s approach. According to the AAA, the cost of car rental is up by 86% as compared to the same period last year. Increased demand and the global chip shortage have pushed the daily rate for car rental as high as $166.
For those hoping that taking to the air will be a cheaper option, the news isn’t good either. On average airfares have increased 7% year on year. Partially this is a result of increased demand, but the hike in fuel prices is also a factor.
It also appears as if the high gas prices are here to stay. Patrick De Haan, head of petroleum analysis for GasBuddy, wrote on the company blog –
“As we approach July 4, it appears the only way forward is for gas prices to continue to rise as Americans’ insatiable demand for gasoline continues to act as a catalyst. With hurricane season soon coming into its prime, we have plenty more catalysts for a rise in price, and few that could restrain the situation. Motorists should prepare to dig deeper for the second half of the summer, unfortunately.”