Despite Gas Prices, Americans Hit The Road

With Prices At The Pump Topping $4 A Gallon, More Than 38 Million Americans Are Traveling This Memorial Day Weekend

(CBS/AP) 

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At the start of the biggest holiday weekend since gasoline price-hikes moved into the fast lane, gas is up more than 90 cents since February. It jumped another nickel overnight, to a nationwide average $3.88 a gallon.

The cost of fuel is keeping some Americans closer to home, and a AAA survey finds the number of Memorial Day travelers is down for the first time since 2002.

Still, nearly 38 million Americans are heading out of town, and paying the price, reports CBS News Business Correspondent Anthony Mason.

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This Memorial Day weekend is one of the biggest on the NASCAR calendar, Mason reports.

It's the running of the Coca-Cola 600 in Concord, N.C. Since last week, fans have been pulling in from all over the country. Steve Biddle drove his motor home more than 1,100 miles from Enid, Okla. But this year, his trip cost him more than $1,000, with diesel fuel averaging more than $4 a gallon.

"About a buck-sixty higher than last year," Biddle lamented.

"Does that hurt?" Mason asked.

"It all hurts," Biddle said.

No other major American sport is hurt more by high gas prices than NASCAR, where fans travel 400 miles round-trip on average to see a race. But those aren't the only Americans hurting at the pumps.

As consumers began hitting the road Friday for the Memorial Day weekend, they faced the sobering reality that it now costs $87 to fill a Ford Explorer SUV, up $14 from last year, and $72 to fill a mid-sized Honda Accord, up $12.

That's because gas prices, which took another jump higher overnight, are up nearly 20 percent, or 65 cents a gallon, over the past year, to average nearly $3.88 a gallon nationally. But unlike this time last year, when gas prices were at their peak for 2007, pump prices now show no signs of halting their daily assault on the record books.

"Four dollars (a gallon) is a done deal now," said Jim Ritterbusch, president of energy consultancy Ritterbusch and Associates in Galena, Ill. "We could go significantly above that."

On average, drivers in Alaska, Connecticut, California, New York and Illinois are already paying more than $4 for gas, and an increasing number of stations around the country are posting prices higher than $4. In Alaska, where the average price of regular gas stood at a national high of $4.181 Friday, it now costs $94 to fill an Explorer, and $77 to fill an Accord.

Nationally, the price of a gallon of regular gas rose 4.4 cents overnight to a record average of $3.875, according to AAA and the Oil Price Information Service. Prices are headed even higher in coming days because of oil's dramatic rally this week to a new record: more than $135 a barrel.

"We're going to see some more significant increases here in light of what we've seen in the last few days," said Tom Kloza, publisher and chief oil analyst at the Oil Price Information Service in Wall, N.J.

Oil prices fluctuated Friday after as investors placed bets before the long holiday weekend. Light, sweet crude for July delivery rose $1.38 to settle at $132.19 a barrel on the New York Mercantile Exchange, after alternating between gains and losses.

Supporting prices was the dollar, which weakened against the euro and attracted more investment money to energy futures. A growing number of investors have come to view commodities such as oil as a hedge against inflation and a falling dollar. Also, a weaker greenback makes oil futures less expensive to investors dealing in other currencies. Many analysts see the dollar's protracted decline as one of the chief reasons oil prices have doubled over the past year.

Growing demand for fuel is also helping boost oil prices. Demand for diesel has spiked in China, where power plants in some areas are running short of coal after last week's earthquake. But even before the quake, Chinese diesel imports were rising sharply. China's government has released nearly 170,000 barrels of fuel from its strategic petroleum reserve this week to ensure adequate supplies in earthquake areas.

"China's just hungry for diesel," Ritterbusch said.

Diesel prices in the U.S. rose 5.9 cents to a record national average of $4.649 Friday, according to AAA and the Oil Price Information Service. Diesel's rise has been far more dramatic than gasoline's; diesel prices are $1.73 a gallon higher than one year ago. Diesel prices are averaging more than $5 a gallon in some parts of the U.S., and may rise above an average of $5 in California and New York state over the weekend, Kloza said. Diesel is used to fuel most industrial vehicles, and is a big part of the reason prices for food and consumer goods are rising.

Heating oil, which is closely related to diesel and often traded as a proxy for the fuel, rose above $4 a gallon on the Nymex on Thursday for the first time. On Friday, June heating oil futures fell 8.87 cents to settle at $3.8656 a gallon. Analysts cited profit-taking for the price swoon, but expect heating oil futures to resume their upward course next week.

Oil prices did come under some pressure Friday as some investors collected profits ahead of the weekend. Many analysts argue that oil prices have risen well beyond levels that can be justified by supply and demand fundamentals; an increasing number of analysts are referring to the situation as a bubble. U.S. demand for fuel and oil has fallen this year. Some analysts see signs in a recent switch in the relationship between the price of the current July crude contract and prices of crude for delivery in future months that tell them prices could soon fall.

Analysts also say a significant reduction in demand for gasoline could bring prices down. Energy Department data shows gasoline demand has fallen for much of the year, and new Federal Highway Administration data shows the number of miles Americans traveled fell 4.3 percent in March compared to the previous year - the first year-over-year drop in March travel since 1979.

But few analysts are willing to call an end to oil's rally, noting that investors just continue to plow money into the market, pushing prices ever higher.

"Big mo (momentum) is driving this thing now," Kloza said.

In other Nymex trading Friday, June gasoline futures rose 6.63 cents to settle at $3.396 a gallon, and June natural gas futures rose 16 cents to settle at $11.857 per 1,000 cubic feet.

In London, July Brent crude futures rose $1.06 to settle at $131.57 on the ICE Futures exchange.

[thcarson-2009]

This just goes to show that the real economic crunch has not hit yet, when it does all of the unnecessary vacations will cease. I do like the idea of not buying from Exxon/Mobil stores, the only problem is that I think all gas is pumped from refiners into pipelines where it is mixed from all different refineries.

[popstom1]

Oil companies here pay $48.00 dollars a barllar
wall st. has added $89.00 to that now what are going
you going to do

[michellem99-2009]

I have.
I use clothe bags.
Use Mass Transit The public buses.
Walk.
Buy what I need.it is not much
Use blankets no plug in ones
Wash full loads.
Use the microwave to heat my one dinner a day.
Uus a 60 watt light to light the desk.
can''tshutup. I was talking to my friend.
Every thing we wear,use ,eat takes oil. That is a fact.
Here is the kicker.
We have become a nation that is more blind than I.
We have become a throwaway use it once toss it.
I was not raised with that mind set.
Alot of sighted persons are using their bikes.Keep it it good working order.
Here is what I have/ ask myself if I am to buy an item.
Will I use it.yes/no
Do I need ityes/no
Will it benefit me.yrs/no

[cantshutup]

so, if you get your bike out of storage and ride to work you aren''t consuming gas...you''re saving money, getting healthy and not padding the pockets of the oil industry...we should not continue to reward them. let''s stop complaining and change our ways if it''s really worth it to us.

[michellem99-2009]

newster yer right. I can''t buy much. I come from a day where we were taught to take of what we have. It may surprise ye I have not bought a new item of clothes for a long time. Men rot their t shirts out..We ladies don''t. I am wearing what I bought ten years ago. It gets washed. Full loads. Yesturday My friend took my big bag of to the washer. I dom''t wash one tiny load. He asked how many monthes Dec 07 to now. I am a hillbilly, My computer books are XP platform. I shut the heat off to heat the bedroom. I pile blankets to keep warm at nite. Run one lite. I conserve.

[trillion1]

I have a cheap push mower. Mow half an acre in less than an hour and less than half a tank of gas.

Lowes sells push mowers. They work great, and you get exercise at the same time.

[ubrew12]

Gas has value.

The dollar does not.

Much of our increase is NOT due to the rising cost of oil, but due to the falling dollar. International financiers have realized something Americans haven''t yet: we won''t be able to pay our Reagan/Bush debt without serious inflation/recession or both, so they''re dumping dollars, gettin'' out while the gettin''s good.

And THAT''s why Bush doubled our national debt. The rich invest their tax breaks overseas (and KEEP it there). The poor inherit the debt when it finally becomes too big for even THEM to ignore.

[nothappyatall]

ho do ye think use the most gas. Take the bus. I don''''t buy gas.

Posted by MichelleM99

Actually you DO, any time you buy products or get something shipped to you, you are buying gas- it''s in the charge and fuel surcharges they add on.

[samrensho]

Despite Gas Prices, Americans Hit The Road

Your durn tootin''. Tell them rag heads "Bring it On" and burn that high test.

[samrensho]

You can bet that the taxpayers are buying gas for Bushits fishing boat(s) when he cruises the Cape.

[jw218389]

Four years of BushMcCain and gas will be $12.00 a gallon.

WE ARE GETTING SCR@WED BY THE GOP!!!!

[michellem99-2009]

Who do ye think use the most gas. Take the bus. I don''t buy gas.

[nothappyatall]

Sounds like your lawn mower is either more efficient than mine or you live in an arid climate with no grass. And thanks for reminding me I can''''t afford beer and cigarettes too.

Posted by dragonwagon5

I have plenty of grass, grows too dam fast, it gets mowed every week sometimes twice a week. My mower is a second hand one, self propelled, 5 HP.
I filled a gallon can with gas and mowed twice already and the can is little less than half full.

I run it on full speed and dont dawdle around, it will just about mow my 1/2 acre with one fill- another half cup tank capacity would do it.

[deacon20081]

Gas prices can drop quickly if Americans act. We are the consumers right? STOP BUYING GAS FROM EXXON/MOBIL buy it anywhere else because obviously we have to buy it. They will drop their prices that is a fact and the rest will follow suit, but we have to cut them off so that their bottom line suffers.

[michellem99-2009]

Seattle The gas is over 4 dollars in WA state. I will be right here at home. Never travel on holiday. I do on computer. If maybe that newster has a system that works for him/her. A yard can be mowed even a big one. If cut properly then it can be kelp neat by mowing to keep an inch . Never cut wet grass. ye know when needed. Can''t afford gas get a manual push mower. If a legally blind person can mow the yard with it then a sighted person can. I was 15. They still sell them as I went on another page looking for them. They have to be maintained. They are earth friendly. The grass has to be mowed.

[laura552]

Our gas here in Great Falls, Mt,USA has gone from3.59
12days ago to 3.77 today. I dont know what it will be tomorrow. The oil companies are making billions more in profits at the expense of the american people.We should pay less than some of the smaller nations as we use more, so it should be discounted. Like when you go to the store and buy in bulk you get a discount.The old rules dont seem to apply anymore and the Arab nations just want to get richer.I feel they are bilking the world.

[michellem99-2009]

They make manual push reel mowers. I used one years ago. They are the answer. I like them and I was a teen . The boys would not use it. neswter ye lucky to live in what I call the sticks.

[michellem99-2009]

newster Amen. I live in a apt and there are 2 things barred no smoking and no drinking. I was riding in a car years ago and I asked the lady do yer plan yer trips in the car. She said no I told her ye should. she never did learn. The love affair with the car will end. I was visting mum years ago and I was shocked. Sis got in the car and drove to the next home that was so close that I can walk to it in 5 min. I told mum sis is too lazy to walk. They will learn when forced to.

[nothappyatall]

I''''m staying home. I can''''t even afford the gas to mow the lawn.

Posted by dragonwagon5


Oh STOP! I can mow my entire half acre of property on a little more than a QUART of gas- one tank full- a dollar, thats less than a pack of cigarettes or a beer, just cut those out and you can mow your lawn.