Memorial Day Gas Prices Will Not Terrify, Especially If You Buy At This Time

NEW YORK (MainStreet) — Travelers who are planning to drive out of town this weekend to celebrate Memorial Day are likely to see gas prices maintain their current rates.

Prices at gas pumps across the country are averaging $3.62 a gallon in many states, according to Gasbuddy.com. The lowest price is in Arkansas where gasoline prices are $3.36 a gallon. Gas jumps to $3.43 a gallon in Texas, $3.86 in New York and as high as $4.12 in California. The highest gas is in Hawaii at $4.35.

Also See: Prepare to Pay More For Gas As Summer Approaches

Regular gasoline retail prices will continue to stay within this range and is projected to reach an average of $3.61 per gallon during the summer months of April through September, the Energy Information Administration said. The annual average regular gasoline retail price was $3.58 per gallon in 2013.

Gasoline prices should continue to retreat, said Chris Faulkner, CEO of Breitling Energy, a Dallas oil and gas exploration and production company.

"It's always a good thing when travelers have more money for beer and BBQ than having to plow it all toward gasoline," he said. "Travelers can keep more cash in their wallets."

Also See: States That Pay the Most for Gas

The company's energy models predict gasoline prices to be at or slightly below last year's levels for the holiday weekend, Faulkner said. The factor leading to declining gasoline prices can be attributed to the fact that crude oil supplies in the Gulf Coast are continuing to put downward pressure on the price of gasoline as demand reached its highest level since 2009.

"I don't see us reaching those levels again even in the mid-to-long term markets," Faulkner said. "Most folks have noticed that gasoline prices have been declining since the beginning of May, which is typical as we conclude the refinery maintenance windows to begin the switch over to producing summer-blend fuel. With this transition now complete, falling averages are indicative that gas prices have reached their peak for the spring in many parts of the country."

The current prices for gasoline are reflecting the fundamentals which include crude oil prices, refining margins and taxes and are not expected to change, said Rob Desai, an energy analyst at Edward Jones in St. Louis.

A few refinery outages over the last month have helped to support product prices, but most of them have already returned to service. Gasoline inventories are near the five-year average, so supplies also appear to be normal, he said. However, demand has increased slowly in the U.S.

"I think with the markets hitting new highs, people feel like they are able to take more leisure time," Desai said. "However, with increasing U.S. oil production and enough refining capacity which is leading to product exports, things seem to be in balance."

Prices should remain fairly constant for the weekend, said Mike Evans, president of Atlas Oil Company, a Taylor, Mich. national fuel supply and distribution company.

"There is an expectation of a higher than normal driving weekend this year," he said. "Gas prices have moved up on their seasonal move for the summer driving season."

AAA Travel projects 36.1 million Americans will travel 50 miles or more from home during the holiday weekend, a 1.5% increase from last year with more than eight in ten travelers who will drive to their destinations. AAA expects holiday gas prices to be relatively similar or even slightly less than last year's national Memorial Day average of $3.63 per gallon.

Consumers should change their driving habits to offset costs from using additional gasoline. Avoiding speeding and accelerating at a measured pace from a stop since cars tend to use the most gasoline starting from a stop, can help increase gas mileage, said Desai.

Apps can often help you determine where the most inexpensive gasoline is being sold, but consumers who drive out of their way to save money on gasoline could wind up spending more.

"That might not make sense in all cases," he said. "If you drive an extra five miles round trip to save five cents per gallon and you fill up 15 gallons in a car that gets 20 mpg, you saved 75 cents but used a quarter of a gallon of gasoline extra. At today's prices that would be around 90 cents, so you'd end up losing money."

Also See: Ethanol Use In Gasoline Can Reduce Foreign Oil Imports

One of the best ways to save money is to fill up your tank on Wednesday or Thursday before 10 a.m., said Faulkner. Buy gas when it's cooler during the day such as early morning or at night to reduce gas evaporation.

"Gas prices rise on Thursdays in anticipation of weekend travel," he said. "10 a.m. is when most station owners make their price change for the day. Unless it is an emergency, do not buy gas on Friday, Saturday or Sunday."

Confirm with your mechanic what octane gasoline your car's engine really needs. Most car engines do not require high octane though the manual will say its "recommended," Faulkner said.

Buy discount gas gift cards from sites like GiftCardGranny.com which offer a diverse selection of discount gas gift cards from various card vendors. Be loyal to one gas company and get rewarded with its cash-back credit card reward program.

--Written by Ellen Chang for MainStreet

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