The nearly 40 million Americans expected to hit the roads this Memorial Day weekend will have something to make them smile while sitting in traffic: cheap gas prices. The national average price of a gallon of gasoline is expected to be $3.08 on Memorial Day, according to projections released Tuesday by fuel savings platform GasBuddy. That would be the lowest gas price at the unofficial start of summer since 2021 and well below GasBuddy’s average of $3.58 last Memorial Day. It’s also sharply lower than 2022, when gas prices on Memorial Day stood at $4.60. The findings underscore how the relatively low cost of fuel has emerged as one of the biggest bright spots in the US economy, even as a trade war and worries about slower economic growth persist. “This is a win for consumers. And if the stars align later this summer, we could even see the national average drop below $3 a gallon,” Patrick DeHaan, GasBuddy’s head of petroleum analysis, told CNN in a phone interview. On an inflation-adjusted basis, gas is expected to drop to the cheapest Memorial Day price since 2003, excluding the Covid-19 pandemic, according to GasBuddy data shared with CNN. “Americans have to work less to fill up their tank,” De Haan said. Yet it’s also true that one of the reasons energy prices are muted is concern that Trump’s tariffs will damage the US and world economies. The roads are expected to be jammed with travelers this holiday weekend. AAA forecasts that 39.4 million people will travel by car over Memorial Day weekend, up 3% from last year and 4.6% ahead of 2019. Subdued gas prices are a highly visible way to drive down the cost of living, one of the leading frustrations among voters last election. “Americans are just bombarded by the price of gasoline,” said Bob McNally, president of consulting firm Rapidan Energy Group. “Lower gas prices are like a psychological tax cut. Even if you’re not filling up your tank that day, chances are you’re seeing the price when you drive around.” Lower gas prices have already contributed to better-than-expected inflation reports in March and April. It’s a trend that could continue. GasBuddy projects prices will average $3.02 a gallon for the entire summer period of Memorial Day through Labor Day. After gas prices surged to record highs in 2022 following Russia’s invasion of Ukraine, President Donald Trump has focused intensely on combating energy prices by promising to unleash domestic production, slash red tape and push OPEC to add supply. US oil prices have plunged about 20% since Trump’s second term began. Analysts say that drop has been driven in part by Saudi Arabia and OPEC’s sharp production increases – moves that Trump publicly called for days after taking office during a high-profile speech at Davos. McNally, a former White House energy advisor to President George W. Bush, said Trump’s efforts to encourage Saudi Arabia to pump more oil appear to have helped. McNally noted that besides the Davos speech, Trump has taken a lighter touch with pressuring Saudi Arabia, especially compared with the intense pressure the president has put on Walmart, China and his handpicked Federal Reserve chairman, Jerome Powell, to follow his policy preferences. “He’s been more deft this time,” McNally said, referring to Trump’s efforts to persuade OPEC to pump more. However, cheaper oil also reflects fears about a separate Trump initiative: a global trade war that business leaders and economists worry is hurting the economy. Oil prices crashed to four-year lows in early April when Trump’s sky-high tariffs sent recession fears skyrocketing. Crude, the lifeblood of the modern economy, rebounded after Trump paused many of those tariffs. Another factor behind lower oil prices: Trump has not followed through on former President Joe Biden’s final-hours move on January 10 to target Russia’s energy sector with harsh sanctions. “A lot of the reason crude prices have fallen is pessimism about the economy and Saudi Arabia and OPEC producing more,” said McNally. Unfortunately for consumers, gasoline prices have not fallen by nearly as much as crude. In other words, gas prices are technically high relative to where oil is trading. McNally blames that mismatch on the shutdown of refineries around the United States as forecasters projected weaker gasoline demand due to the rise of electric vehicles. “It’s like Mark Twain said: Reports of gasoline’s death are premature. It’s not dying, but we are reducing the production of it,” McNally said.
Gas prices are set for their cheapest Memorial Day since 2021
TruthLens AI Suggested Headline:
"Memorial Day Gas Prices Expected to Hit Lowest Level Since 2021"
CNN
7.6
TruthLens AI Summary
This Memorial Day weekend, nearly 40 million Americans will benefit from the lowest gas prices seen since 2021, with a projected national average of $3.08 per gallon. This figure is significantly lower than the $3.58 average from the previous Memorial Day and a stark contrast to the $4.60 average in 2022. The decrease in fuel prices has emerged as a positive aspect of the U.S. economy amidst ongoing concerns about a trade war and slowing economic growth. Patrick DeHaan, head of petroleum analysis at GasBuddy, noted that if conditions align, the national average could even dip below $3 per gallon later this summer. Furthermore, when adjusted for inflation, this price represents the cheapest Memorial Day gas since 2003, excluding the anomalies of the COVID-19 pandemic. DeHaan emphasized that Americans are spending less time earning money to fill their tanks, a welcome relief for consumers who have been grappling with rising living costs.
Travel predictions indicate that 39.4 million people will travel by car this holiday weekend, marking a 3% increase from last year and a 4.6% increase compared to pre-pandemic levels in 2019. Lower gas prices serve as a tangible way to alleviate the cost of living, which has been a prominent concern for voters. Analysts have noted that these prices have contributed to better-than-expected inflation reports in recent months. The trend of decreasing gas prices is tied to various factors, including increased oil production from Saudi Arabia and OPEC, as well as a decrease in U.S. oil prices since the beginning of Donald Trump's second term. However, the mismatch between lower crude prices and gas prices is attributed to refinery shutdowns and a projected decline in gasoline demand due to the rise of electric vehicles. Bob McNally, president of Rapidan Energy Group, commented on the current state of gasoline production, suggesting that while gasoline is not declining in usage, production is being reduced. This complex interplay of factors continues to shape the landscape of fuel pricing as the nation approaches the summer driving season.
TruthLens AI Analysis
The article provides insights into the anticipated drop in gas prices for the upcoming Memorial Day weekend, presenting it as a positive development for American consumers. The mention of lower gas prices is framed within the broader context of economic sentiments, trade tensions, and consumer behavior, highlighting its significance in the current economic landscape.
Economic Implications of Gas Prices
The article emphasizes that the expected national average price of $3.08 per gallon is a notable decrease compared to previous years, specifically citing prices from 2021 and 2022. This decrease is framed as a positive sign for consumers, suggesting that lower fuel costs might alleviate financial pressures amid concerns about inflation and slow economic growth. The assertion that this price point represents the lowest since 2003 (excluding the pandemic's influence) serves to underscore the potential relief for consumers, positioning it as a "psychological tax cut."
Consumer Sentiment and Psychological Impact
The notion that lower gas prices can be perceived as a psychological boost is significant. The article cites experts who argue that consumers might feel more financially secure with reduced fuel costs, even if they do not fill their tanks frequently. This perspective aligns with the idea that gas prices are a visible indicator of economic health and consumer confidence, suggesting that the government or media may use this information strategically to bolster public sentiment.
Political Context and Economic Concerns
Interestingly, the article connects the drop in gas prices to broader economic concerns, including the impact of tariffs and trade wars. This duality highlights a potential underlying agenda: while presenting low gas prices as beneficial, it also hints at the fragility of the economic situation. By mentioning the influence of tariffs, the article subtly raises questions about the sustainability of these low prices and the potential for future economic repercussions.
Potential Manipulative Aspects
There is a possibility that the article seeks to manipulate public perception by focusing heavily on the positives of gas prices while downplaying the possible negative implications of economic policies. The language used, which highlights the benefits of lower prices without equally addressing potential drawbacks, suggests a bias towards creating a favorable view of the current economic narrative.
Comparative Analysis with Other News
When compared to similar articles, this one stands out for its optimistic tone amidst ongoing economic concerns. The focus on consumer benefits could indicate an attempt to foster a narrative of recovery or stability, which might resonate well with audiences who are feeling the pinch of inflation in other areas of their lives.
Community and Demographic Engagement
The article likely appeals to a broad audience, particularly those who travel or rely on vehicles for daily activities. It addresses middle-class consumers who are most affected by gas prices, thus tapping into a demographic that is likely to appreciate and share this positive news.
Market Impact Potential
The implications of this news could extend to stock markets and specific sectors, particularly those related to energy and consumer goods. Companies involved in fuel distribution may see fluctuations in stock prices based on consumer response to this news, highlighting the interconnectedness of gas prices and broader economic trends.
Global Context and Relevance
While the article primarily focuses on a domestic issue, the implications of gas prices are global, especially in an interconnected economy where energy prices can influence international markets. The discussion ties into today's economic realities, where energy costs are central to debates about inflation and economic recovery.
In conclusion, the article presents a largely positive view of impending gas prices, potentially serving to influence public sentiment in a favorable light while omitting some complexities of the larger economic situation. The reliability of the information appears sound based on data from GasBuddy, yet the framing may skew towards a more optimistic narrative.