High gasoline prices may not deter Labor Day weekend travel - Villages Daily Sun
THE VILLAGES — Mike and Joan Everts kept their travel plans pretty simple for this Labor Day holiday weekend.
Preferring the simplicity of golf cart travel, the Village of Santiago couple probably won't venture any farther than morning swims at either Saddlebrook, Santiago or Chatham recreation centers, or maybe some evening trips to The Villages town squares to enjoy the free entertainment.
On the surface, it appears the couple's holiday plans align pretty closely with what other Villagers have in mind and also what AAA found in this year's Labor Day weekend travel forecast.
While its results of its latest travel survey appears flat, the national travel service discovered that more people are likely to drive an automobile — rather than take a plane, train or bus — this holiday weekend on trips of 50 miles or more.
None of those figures into Mike and Joan's plans, however.
"We may get together and have a barbecue with friends," Joan said.
Pent-up demand
In its annual Labor Day weekend survey, AAA apparently found some pent-up travel demand.
"We're seeing a slight decrease in overall travel nationwide," AAA Auto Club South spokeswoman Jessica Brady said of the annual survey results. "But there's also a slight increase in auto travel."
The survey found that consumers appear less likely this year to let higher gasoline prices dampen their travel plans, Brady added.
"Seven out of 10 respondents said gas won't affect their travel plans," Brady said. "People are still traveling."
The price of unleaded regular gasoline averaged around $3.50 a gallon as of early Thursday morning, a Daily Sun survey showed.
Prices in The Villages averaged about 44 cents above the year's low of about $3.06 per gallon the first week of January and about 41 cents below the year's high of about $3.91 per gallon during the first and second week of May.
The price in The Villages averaged about 10 cents cheaper Thursday than the Florida average published in the "Daily Fuel Gauge Report," the survey that AAA produces daily in cooperation with the Oil Price Information Service and Wright Express.
Crude oil futures prices settled up by 12 cents Thursday at $88.93 per barrel at the close of trade Thursday on the NYMEX, a CME Group commodities exchange. That compares with a settlement price a week ago of $85.30 per barrel.
Reformulated gasoline futures prices settled up by 2 cents at $2.89 per gallon at the close of trade Thursday on the NYMEX, compared with a settlement price a week ago of $2.97 per gallon.
Expect an increase of a few more pennies in the days to come, Brady said, because of recent fluctuations in crude oil and reformulated gasoline futures prices.
Divergent trends
The AAA survey revealed a blip in what otherwise appears to be flat consumer demand for gasoline.
Year-over-year gasoline consumption was 2 percent lower during the first six months of this year, the federal Energy Information Administration published Wednesday in "This Week in Petroleum."
"Higher gasoline prices in 2011 compared to the same period in 2010 appear to be the main driver behind the recent drop in gasoline demand," the federal agency reported. "The impacts of increased economic activity and increased vehicle efficiency, which move gasoline demand in opposite directions, were each about half the size of the impact of higher prices, and taken together the two effects were largely offsetting."
Vehicle miles traveled in June also remained soft, the Federal Highway Administration reported in its most recent monthly survey, "Traffic Volume Trends."
Travel on all U.S. roads and streets for June was 1.4 percent less than the same month last year, the federal agency reported.
In Florida, travel volume decreased in June by 2.2 percent, the federal agency reported.
Meanwhile, commercial crude oil and whole gasoline inventories paint a mixed picture.
Week-over-week inventories of U.S. commercial crude oil, excluding the Strategic Petroleum Reserve, increased by 5.3 million barrels for the week ended Aug. 26, the EIA reported Wednesday afternoon in its "Weekly Petroleum Status Report."
But total motor gasoline inventories decreased by 2.8 million barrels for the weekend ended Aug. 26, the EIA reported.
Those figures compare with a decrease of 2.2 million barrels of crude oil but an increase of 1.4 million barrels of motor gasoline for the week ending Aug. 19, the federal agency reported.
Gasoline blends
Consumer demand reacts largely to local gasoline prices, said Ned Bowman, executive director of the Florida Petroleum Marketers & Convenience Store Association, a Tallahassee-based trade group.
That reaction would determine whether prices subsequently rise.
"A lot of that demand depends on the price of gasoline," Bowman said. "If people are postponing long vacations — say, trips to California — then demand for gasoline could go up. But I think demand is pretty flat right now."
The big concern right now for the crude oil refiners, as well as retailers, is the remainder of the 2011 hurricane season, Bowman said.
Hurricane Irene, for instance, had little impact on retail prices in Florida, Bowman said, but has caused serious gasoline shortages in the New England states.
The recent appearance of Tropical Storm Katia in the Atlantic, or any storms that follow, pose a potential problem because the refiners begin the annual transition the day after Labor Day to winter blend fuels from summer blend fuels, Bowman said.
"If a hurricane comes in, and you're in between blends, you could have a potential supply problem," Bowman said. "So we're hoping the storms wait until after Oct. 1, when the switch has been completed."
David R. Corder is a reporter with the Daily Sun. He can be reached at 753-1119, ext. 9066, or at david.corder@thevillagesmedia.com.
02 Sep, 2011--
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