The average price of a gallon of regular gasoline was $2.86 on July 3, the highest level for the July Fourth holiday period in four years, according to AAA, the motoring and travel group.
However, for the more than 40 million motorists expected to travel this week, they will find gasoline prices at the pump 11-cents cheaper than this past Memorial Day holiday, AAA said.
“The national gas price average has held fairly steady for the past 10 days, suggesting that U.S. demand is keeping pace with supply and stabilizing summer gas prices,” said Jeanette Casselano, AAA spokesperson.
“However, elevated crude oil prices and other geopolitical concerns could tilt gas prices more expensive in the early fall despite an expected increase in global crude production from OPEC and its partners.”
Gasoline prices, which could create a political headache for President Donald Trump ahead of November elections, are a visible cost of living indicator, especially during the summer vacation season.
A record 47 million people in the U.S. are expected to travel more than 50 miles for the Fourth of July holiday weekend.
Gasoline prices have risen about 30 percent since Trump took office, mainly due to a pact by Organization of the Petroleum Exporting Countries and its allies to curtail oil output to help reduce an oversupply of crude. They agreed last month to boost output.
But Trump, who has accused OPEC of manipulating oil prices, wants group leader Saudi Arabia to pump even more crude.
Meanwhile, U.S. consumers put a high value on fuel economy when buying a new vehicle, according to a Reuters/Ipsos opinion poll, as automakers lobby the Trump administration for relief from mileage requirements enacted by his predecessor.
In a Reuters/Ipsos poll taken May 31 to June 15, 41 percent of respondents said mileage was most important to them when buying a new vehicle, after cost and safety but before warranty, brand, design and high-tech features like navigation.
This is roughly the same set of priorities that U.S. adults set in a similar poll taken in July 2017.
Among respondents who identified as Trump voters, 34 percent said they wanted automakers to focus on improving fuel efficiency – a higher share than respondents who identified as Democrats or Hillary Clinton voters.
The Trump administration has signaled it could act soon to freeze emissions standards from 2020 through 2026. The state of California and other states have said they will fight such an action, leaving automakers to confront two separate emissions standards within the U.S. market.
But fuel economy is a challenging issue for automakers. Trade groups representing major automakers competing in the United States have asked the Trump administration for more leeway to meet Obama administration vehicle fuel economy targets, arguing the rules are costly and not in sync with consumer demand.
Those rules require automakers to slash the carbon emissions and roughly double the average fuel efficiency of their U.S. light vehicles by 2025 compared with 2011.
Automakers are also worried that state mandates to sell more electric and hybrid vehicles will hurt profits, because those vehicles are money-losers in a U.S. market that is shifting toward sport utility vehicles (SUVs) and trucks.
One reason is that 2018 sport utility vehicles on average are 24.7 percent more fuel efficient than SUVs of a decade ago, and are now close to the fuel economy levels of a 2008 sedan, according to an analysis by Cox Automotive, which tracks market data and purchase trends. A new 2018 SUV averages 23.7 miles per gallon. A new 2008 car averaged 24.8 miles per gallon.
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