Memorial Day gas prices will be the cheapest in five years
Although gas prices have gone up by 70 cents since January, they are still almost a dollar less than last year's prices. As more drivers hit the roads for Memorial Day weekend and the rest of the summer, it is uncertain whether gas prices will rise or fall.
Gas prices have steadily increased for the past month, but they remain nearly $1 per gallon less than last year’s prices as 37.2 million travelers hit the road for Memorial Day weekend.
Americans traveling between Thursday May 21 and Monday May 25 will see the cheapest Memorial Day weekend prices since 2010, according to AAA. The national average is at $2.74 per gallon, 91 cents cheaper than last year's prices.
Drivers on the West Coast – especially California – have seen much higher averages in the US because of localized refinery issues that have constrained supplies and push prices higher. In February, a large explosion at a Exxon Mobil refinery in Torrance, Calif. injured four workers and shut down part of the factory. Prior to the explosion, a Tesoro Golden Eagle refinery in Martinez closed after workers went on strike. Exxon Mobil and Tesoro Corp. refineries account for 17.5 percent of the state refineries' total oil processing capacity, according to the Los Angeles Times.
Because California is more dependent on in-region production than other states, the two incidences continue to have effect on the Golden State's prices. The average price for regular gas is $3.78, more than a dollar than the national average. Nevada's average, the second-highest in the country, is almost 50 cents less at $3.31.
Gas prices across the US have gone up by 70 cents since January. Last month, the national average was about $2.48. Yet prices are better compared to last year's Memorial Day weekend, when gas was about $3.65 per gallon. But where will prices be in the later summer months?
There is no definite answer. This year's gas prices have not been completely aligned with historical trends, AAA public relations manager Michael Green says in a phone interview. In a normal year, prices begin to fall by the middle of May as refineries produce more gasoline to ensure supply. However, concerns at home and abroad, including ongoing nuclear negotiations in Iran and the slowdown in shale production in the US, have contributed to volatility in oil prices, leaving the future of pump prices uncertain.
Crude oil prices also have ticked up since January from $48 a barrel to nearly $60 now. Barrel prices dipped in late March to $49, but prices have gone back up. Green says experts are split on the market; some see barrel prices going as low as $35 a barrel, while others see it reaching as high as $90. It makes it very hard to predict where gas prices are going to be down the road.
"If oil prices stabilize, then there's hope gas prices will drop soon as well," he adds.
For now, experts and consumers will have to wait and see what crude oil, and inevitably, gas prices will do. Green does not see gas prices going up higher than $3 a gallon for the rest of year, unless a major event such as a powerful hurricane drastically affects production.