Holiday drivers shrug at record gas prices

National average tops $3.11 a gallon to reach yet another all-time high, but AAA says rising prices won't slow driving for the Memorial Day weekend.

By Chris Isidore, CNNMoney.com senior writer

NEW YORK (CNNMoney.com) -- Gasoline prices hit a record high for the fifth straight day Thursday, according to the daily reading on gas prices from AAA, but a separate survey by the same group is also projecting that a record number of Americans will be on the road during the Memorial Day holiday.

The motorist group says the average price for a gallon of self-serve unleaded gasoline was $3.114 in its latest reading, which is based on a daily survey of purchases at up to 85,000 gas stations. That's up from Wednesday's record of $3.103 a gallon.

A series of record high gas prices won't stop an increase in driving by Americans over the Memorial Day holiday weekend, according to AAA.
A series of record high gas prices won't stop an increase in driving by Americans over the Memorial Day holiday weekend, according to AAA.

And the group believes that more record-high prices could be on the way. It is forecasting prices are likely to approach $3.25 a gallon during the next 60 days.

But the AAA's survey of 1,950 Americans finds a record 38.3 million will be traveling 100 miles or more over the Memorial Day holiday, up 1.7 percent from a year ago. And most of those - 32.1 million - will be driving on their trip, despite the higher gas prices and a rise in hotel room rates found by the travel agency. Those driving will be up 1.8 percent.

Another 4.4 million are expected to fly over the holiday, up 1 percent from a year ago, while 1.9 million will travel by train, bus or another mode of transportation, little changed from last year's travel level.

"High gas prices will not deter Americans from traveling this Memorial Day," said Sandra Hughes, vice president of travel for AAA, said in a statement. "Families will travel closer to home, they will travel for fewer days and will save money by staying in less expensive hotels and eating in cheaper restaurants, but they will continue to take vacations and plan getaways."

The cost of a room in a three-diamond AAA hotel will be up 13 percent from a year ago to $174 a night, according to the group.

There will be some drop in the average price paid for airfares and car rentals over the holiday, according to the AAA whose figures are at odds with industry and government readings showing both those prices higher than a year ago. The typical round-trip airfare this holiday will be $166, according to AAA.

But the savings for air travel and cars will be minimal, said AAA spokesman Mike Pina.

"What's at issue for these guys is $3.11 a gallon gas and more expensive hotel rooms," Pina said.

Topping post-Katrina records

Before this week's series of record-high gas prices, the highest price ever recorded in the survey was $3.057, which was set Sept. 4 and Sept. 5, 2005, in the wake of Hurricane Katrina, which disrupted refinery operations and pipelines and caused a temporary spike in prices. The only other time that the AAA national average has topped the $3 mark was in August 2006, after Israel invaded Lebanon and oil futures shot higher. Gas prices topped out at $3.036 in that spike.

But problems in gasoline supplies and refinery output sent the average gas price above the $3 a gallon mark on May 4, and it's been climbing relatively steadily since. On Sunday it set a new record, reaching $3.0637, and it's been up from there each day since.

Prices are now up 2.5 percent in just the last week, and have risen 8.7 percent over the last month.

California had the highest average price, with a gallon of self-serve unleaded costing $3.467, although that's down slightly from the $3.474 level in the Wednesday reading.

South Carolina continues to have the cheapest gas in the survey, but it is also creeping toward the mark of $3 a gallon, with an average price of $2.864, up from $2.853 Wednesday.

The state-by-state breakdown shows 34 states and the District of Columbia now have average prices at or above $3 a gallon, with Pennsylvania being the latest to cross that threshold, rising to an even $3 a gallon from $2.992 Wednesday.

And Massachusetts, North Carolina and Arkansas are poised to be the next states to cross that benchmark, with each a penny a gallon or less away from the $3 mark.

The Energy Information Administration's weekly survey of service station prices also found Monday a new record high of $3.10 a gallon for unleaded. That was up 5 cents from a week earlier and up 16 percent over year-ago levels.

While crude oil prices have fallen over the last few weeks and oil supplies are high in the United States, problems at several refineries have crimped gasoline output ahead of the summer driving season.

The refinery problems include fires, power outages, and longer-than-usual maintenance periods.

Big Oil went on the defensive Wednesday, getting grilled before a House panel and denying accusations that mismanagement and a lack of competition are the reasons behind this spring's record gasoline prices. Top of page

Sponsors
Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer LIBOR Warning: Neither BBA Enterprises Limited, nor the BBA LIBOR Contributor Banks, nor Reuters, can be held liable for any irregularity or inaccuracy of BBA LIBOR. Disclaimer. Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.
Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer LIBOR Warning: Neither BBA Enterprises Limited, nor the BBA LIBOR Contributor Banks, nor Reuters, can be held liable for any irregularity or inaccuracy of BBA LIBOR. Disclaimer. Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.