GasBuddy forecasts $4.48 average on Memorial Day

GasBuddy said on May 20 that the U.S. national average for gasoline would reach $4.48 a gallon on Memorial Day, up from $3.14 a year earlier, as millions of Americans prepared to drive over the holiday weekend. AAA said 45 million Americans were expected to travel at least 50 miles from home between Thursday, May 21, and Monday, May 25, a record for the holiday period. CNBC reported that higher fuel costs were colliding with strong travel demand at the start of the summer season. ### Why are gas prices a Memorial Day story this year? Memorial Day is one of the biggest road-trip weekends in the United States, and AAA said most holiday travelers would go by car. The group’s May 11 forecast covered travel from May 21 through May 25 and put total holiday trips at 45 million, slightly above last year’s 44.8 million. (gasbuddy.com) CNBC reported on May 23 that travel, recreation and food prices were all rising into the holiday weekend. Stephen Juneau, a senior U.S. economist at Bank of America, told CNBC that consumers “are not going to be happy about what they see,” referring to higher costs tied to summer travel. ### Where does the $4.48 figure come from? GasBuddy said its forecast was based on price data compiled from more than 150,000 gas stations and more than 12 million individual price reports. (newsroom.aaa.com) In a May 20 press release, the company said the national average would reach $4.48 a gallon on Memorial Day. (cnbc.com) The same GasBuddy release said that $4.48 would be up sharply from $3.14 per gallon a year earlier. CNBC separately reported on May 22 that U.S. drivers were paying near four-year highs ahead of the holiday weekend and that analysts saw the possibility of $5 gasoline this summer if the Strait of Hormuz did not reopen. (gasbuddy.com) ### Why is GasBuddy talking about Labor Day already? GasBuddy said on May 20 that the national average could run at $4.80 a gallon over the summer, from Memorial Day through Labor Day, if the Strait of Hormuz remained closed for a significant part of the season. The company said all-time record highs were possible under a prolonged closure scenario. (gasbuddy.com) CNBC linked the gasoline outlook to wider summer travel costs, including airfare and other consumer spending categories. In a separate March 24 report, CNBC said traffic through the Strait of Hormuz had been effectively halted, disrupting global oil supplies and pushing up fuel costs. ### What were drivers actually paying at the pump this week? (gasbuddy.com) Forbes reported on May 23 that AAA put the national average for regular gasoline at $4.56 a gallon on May 21. Forbes said that was the highest Memorial Day weekend level in four years. Forbes Advisor said the U.S. average was $4.55 a gallon as of May 22, down one cent from the previous day and up 53 cents from a month earlier. (cnbc.com) The same update said the average price a year earlier was $3.20. ### Who is saying demand is still holding up? AAA said on May 11 that 45 million Americans still planned holiday trips despite higher costs. (forbes.com) CNBC’s May 23 reporting said higher prices were testing consumer budgets, but demand for Memorial Day and summer travel remained strong. GasBuddy and AAA are both continuing to publish national fuel-price updates through the holiday period, and AAA’s Memorial Day travel window ends on Monday, May 25. (forbes.com) GasBuddy’s summer forecast runs through Labor Day, the next major benchmark in its outlook for U.S. pump prices. (gasbuddy.com) (newsroom.aaa.com)